SMS, the humble messaging service of the mobile world recently celebrated its 15th birthday, an accidental invention that has demonstrated remarkable resilience and is still at the top.
SMS usage continues to grow every year with more and more new innovative ways of utilizing its potential coming to the forefront. Indians are using SMS as an extension of their lives more and more every year, an average Indian sends 29 SMS per month (TRAI data). It’s being used not just to keep in touch with friends and family but to check bank balances, mobile bills, and status of train/flight to name a few.
The following market report looks at SMS usage in Urban India to shed some light on its future and answer a critical question, “Is SMS here to stay or will it be replaced?”
SMS VAS in India – Perspective
Indians use SMS for all sorts of reasons from receiving jokes to checking on flight status to enquiring about exam results. It’s a very powerful medium for getting in touch with people without soliciting a backlash as seen on phone calls. It’s effective for getting the message out to potential customers or retaining existing ones. Some key points of this report are:
- 1 in 5 urban Indians have used a SMS based VAS service either as a one-off or on subscription basis
- SMS is an effective marketing tool, showing conversion rates a lot higher than other conventional mediums i.e. TV/Radio etc. 1 in 3 Urban Indian has acted in some manner over the SMS i.e. forwarding to others or enquiring about it.
- SMS, an advertising medium, has an interaction rate of around 5%
- A quarter of urban Indians have participated in some sort of SMS contest, a valuable tool for getting consumers involved with products/services
SMS VAS Users – City wise Distribution
SMS is a popular medium for delivering Value Added Services (VAS); it’s a valuable revenue source for service providers, almost 5% of service provider revenue comes from SMS VAS services the highest revenue earning VAS.
Almost 20% of Urban Indians or 1 in 5 have used a SMS VAS service over the quarter ending May 2009. On looking at the big 7 Indian cities, Delhities are the most avid users of SMS VAS services, accounting for 6% of all SMS VAS users in Urban India followed by Mumbai and Chennai at 5% each.
Most Popular SMS VAS Usage
Receiving jokes via SMS on phones is the most popular SMS VAS service, subscribed by 1 in 2 SMS VAS subscribers followed by Astrology (47%), News alerts (44%) and Jobs (43%).
Gender wise Distribution of VAS Usage
Males are generally more active users of SMS VAS services compared to their counterparts. While males are more interested in getting sports updates females are interested in spiritual and astrology quotes.
SMS VAS Usage Distribution by Age
On looking at usage of SMS VAS services by age, SMS related to “Stocks/Finance/Business” are most popular among 55 years or older people while Jokes are the most popular SMS VAS service for 18 to 44 years old.
SMS as a Marketing Tool
SMS is increasingly being viewed by India Inc. as a source of getting in touch with their customers. This is evident from the fact that every second urban Indian acknowledged receiving marketing/promotional SMS on their phone in quarter ending May 2009.
The intensity of using SMS for marketing/promotions is quite high with almost 75% receiving a minimum of 4 such SMS.
SMS – What’s in for companies to use the medium?
Companies offering downloads for ringtones/wallpapers/games use SMS as a marketing tool a lot more frequently, 37% of Urban Indians have received a SMS offering such products, followed by entertainment/media companies i.e. movies, music etc, garnering a 36% recall rate.
Efficiency of SMS as a Marketing Tool
1 in 3 of Urban Indians who receive a marketing/promotional SMS take some action while 2 out 3 deleted or ignore the message completely.
Calling up to inquire (if number available) followed by forwarding message to others are the two most commonly cited actions taken on receipt of marketing/promotional SMS. While 11% also indicated they made a purchase on the basis of information received via SMS.
SMS Marketing Effectiveness – The Battle of Sexes
Females are less likely to ignore and/or delete the message compared to males and are more likely to enquire further i.e. by calling up customer service or walking into the store. However males are more involved when it comes to using the coupons/discounts offered in SMS.
SMS Marketing Effectiveness – What’s Age Got to with it?
35 to 44 year olds are most likely to purchase a product(s) and/or service(s) based on information received via SMS.
SMS as an Advertising medium
SMS is so widely used in India that it’s now becoming a medium for advertising as well. Many companies are using this powerful medium to advertise their offerings. 8% of the urban Indians, approx 22 million have seen an ad in a SMS they have received, while 65% of those who have seen have also read the advertisement message. Such high level of awareness indicates the importance of this medium for advertising.
SMS is also widely used to get people involved in contests for products/services/games etc. 26% of urban Indians have participated in a SMS contest with males participating more compared to females.
Source of contests:
TV is by far the most popular medium for spreading awareness about SMS contests, 87% of all those who participated in such contests found out about them via TV.
SMS: Miscellaneous Uses
- 2% of urban Indians, approx 6 million have used SMS to get directions
- 7% have used SMS to get reminders for upcoming bill payments
- SMS was used as a tool for getting in touch with population by almost all national and regional political parties in recently concluded federal elections. 10% of urban Indians received SMS message(s) from one or more political parties.
Do share your opinion on this report.
The report is analyzed using mobile service usage data for March 2009 to May 2009 time frame. 5,959 respondents were interviewed and their data projected to Urban Indian population owning a mobile phone, approx 271 million. Margin of error is 1.27%.
This report looks at SMS as a value added service, a marketing tool, advertising medium, a mode of getting consumers involved. Any suggestions or questions pertaining to this report may please be addressed to Naveen Menon