Cost of SMS Marketing Services: Plans, Fees, and Hidden Costs

The cost of text message marketing is one of the first things businesses consider when planning SMS campaigns. However, understanding the true cost of SMS marketing involves much more than just per-message rates. In fact, for most businesses, the overall  SMS marketing cost is the deciding factor when choosing the SMS marketing platform. 

Of course, finding out “how much SMS marketing costs?” is not always simple because different SMS marketing service providers use different SMS marketing pricing models. Besides, rates can vary by region, and even hidden fees can add up quickly. 

In this blog, we will discuss everything you need to know about the cost of SMS marketing. So, if questions like: “How much does the cost of SMS marketing?” Or “Why did my SMS blast costs suddenly increase?” ever pop into your mind, you’ve come to the right place. 

Let’s break down SMS marketing prices so you can make an informed decision based on your business goals and budget.

How Much Does SMS Marketing Cost?

SMS marketing cost generally depends on message length, type, audience location and size, carrier and provider pricing models, region, and other factors. All of these can multiply the cost of the SMS marketing. Message length, in particular, plays a major role. A standard text message has an SMS character limit of 160 characters, whereas a Unicode message, which includes emojis and symbols, allows up to 70 characters. 

If a message exceeds that limit, it is split into multiple message segments, and you need to pay separately for each segment. For example, if you send a 480-character SMS, it counts as 3 SMS messages. Similarly, if you send a 161-character SMS, you need to pay for 2 SMS messages.

So, if you’re wondering how much SMS marketing costs, let’s break it down.

If you send a 320-character SMS to 1,000 contacts, the cost of SMS marketing will be: 2 SMS per contact × 1,000 contacts ×  $0.012 per text message (using Textdrip as an example).

SMS Marketing Cost = 2 × 1,000 ×  0.012 = $24

If you want to control the cost of SMS marketing, you can follow the tips and tricks below.

• Limit the frequency so you don’t overspend.
• Keep the text short so you don’t have to pay for extra segments.
• Use the STP marketing approach to segment contacts and send highly targeted, relevant messages to a specific audience.
• Use Textdrip’s SMS pricing comparison calculator to find out which SMS marketing platform is the most cost-effective solution for your business texting needs.

What Factors Affect the Cost of SMS Marketing?

Many factors affect the cost of text message marketing, such as message length, message type, message volume, phone number type, carrier fees, compliance and registration fees, destination location, provider charges, and more. 

Therefore, you should look for:

• Message volume > low per-message cost – If you send bulk messages or go for monthly credit plans, providers usually offer discounts, which reduce your overall per-SMS cost. 

For example,

In Textdrip, when purchasing credit plans, if you choose a custom plan of 10,000 credits, you will get a 5% discount.

And, if you purchase 50,000 credits, you will get 20% discount.

• Message length and message type > Charges based on the segment – if the message length crosses the character limit, longer text messages are divided into multiple segments. With Unicode encoding, the segment limit is usually much shorter, which increases the total number of segments sent.
• Phone number type > Set up and lease charges – To protect customers from spam messages, SMS marketing rules are getting stricter every day. You will need a registered number for business texting. 10DLC numbers require registration, toll-free number needs verification, and short codes require premium leasing.
• Country > Carrier fees – If you send international SMS, it will cost you higher network charges.
• SMS Vs MMS > Extra charges by media type – If you include images, videos, or GIFs in a message, it converts SMS into MMS, which increases your text message marketing cost.
• Compliance and registration > Additional campaign charges – Generally, US carriers need 10DLC brand and campaign registration. Additionally, businesses must strictly follow SMS compliance best practices.

If you want to keep SMS marketing costs predictable, keep the SMS character limit to 160 characters or less and avoid multi-segment charges.

What SMS Pricing Models Do Most Providers Use?

SMS marketing pricing differs based on the SMS marketing platform you choose and the pricing plans it offers. However, here are the three main types of SMS pricing models that most providers offer.

At Textdrip, we offer monthly and annual plans. So, the text message marketing cost depends on the tier you choose. 

Monthly Plans

Our monthly plans start at $19.99 for Spark Starter, $34.99 for Growth Gear, and $74.99 for Elite. 

Annual Plans

Our annual plans start at $191.88 for Spark Starter, $335.88 for Growth Gear, and $719.88 for Elite. 

Want to know what features each plan includes? Check our SMS marketing pricing page for more details.

How to Calculate SMS Marketing ROI?

SMS ROI is the key performance indicator that tells you the profits you gain by investing in text marketing. It shows how much revenue you generated compared to what you spent. 

SMS ROI = (Net Profit / Cost of Investment) x 100

For example:

If you run an SMS campaign of 2000 messages per month using Textdrip, and the rate per message is $0.012, then:

The total investment = $0.012 x 2000 = $24

Now, if the total profit from this campaign is $1,000, your ROI would be:

($1000 / $24) x 100 = 4166.66%

There are also a few other factors that affect SMS ROI. Let’s check them one by one.

CPC

Cost per click = Total campaign cost / Number of clicks.

If you spent $24 on an SMS campaign and received 10 clicks on the link in the text message, your CPC = $24/10 = $2.4 per click

SMS Conversion Rate

SMS Conversion Rate = (Number of conversions / Number of messages delivered) x 100

If you send 1000 messages and 800 were delivered, and from that, 100 people converted, the SMS conversion rate would be: (100 / 800) x 100 = 12.5%

Cost Per Lead

CPL = Total cost of lead generation / total number of leads generated

If you spent $200 on lead generation and got 20 leads, the CPL would be:

$200 / 20 = $10

Now that you know the SMS marketing cost, you may wonder, once I set up my SMS campaign with Textdrip, how can I increase lead conversion without any manual effort?

Read on to get the answer.

How Can You Go Beyond Sending SMS to Increase Conversion Rate With Textdrip?

The best thing about Textdrip is that it easily integrates with other tools. Tools that help increase your conversion rate include Landline Remover and Positiveintent.ai. 

Once you upload your leads into Textdrip, if you’ve integrated Landline Remover, then Landline Remover filters out landline numbers, known litigators, DNC lists, and VoIP numbers. So, you will be left with only mobile numbers.

Boost Sales By Planning Cost-Effective SMS Campaigns With Textdrip

The main goal of an SMS campaign is to attract new customers and retain the existing ones. With a good SMS marketing platform, you can easily achieve this. Of course, choosing the right platform can seem complicated when SMS marketing cost is a deciding factor. However, when you understand the pricing factors that affect the cost and the pricing model that aligns with your business, you can easily choose the ideal SMS marketing platform. If you want to apply text message marketing to your business, Textdrip is the right platform. 

Textdrip gives you access to features like drip SMS campaigns, mass texting, two-way SMS, SMS automation, and personalization, all of which help increase conversion rates and ROI. Additionally, setting up an SMS campaign is quite easy with Textdrip, allowing you to effectively reach your target audience. If you’d like to see Textdrip in action, sign up for a 14-day free trial or book a demo today!