How Much Does SMS Marketing Cost? Understand Pricing

Business texting can be a cost-effective way to reach prospects and customers. Yet text message marketing costs aren't always easy to calculate or compare. From segments and short codes to bulk rates and monthly plans, there are a lot of factors to consider.

Whether you're a small business sending occasional texts or a mid-market company with a growing contact list, this guide will help you understand SMS marketing costs, find a pricing model that fits your needs, and maximize the ROI of your text messaging campaigns.

How Does SMS Marketing Pricing Work?

SMS marketing platforms typically use one of three popular pricing models. The right one for your business depends on your usual message volume, variations from month to month, and your intention to scale.

Pay-Per-Text Pricing

Pay-per-text pricing applies a set fee to every SMS message. So if you plan to send 100,000 messages per month, all you have to do is multiply the number of texts by your provider's standard rate.

However, you may need to factor in a few different rates. For example, many business texting platforms charge different fees for inbound and outbound texts and for SMS and MMS messages.

So if you offer two-way texting, make sure to estimate the number of inbound texts you'll receive to get a more accurate picture of your total costs.

SMS Subscription Plans

Subscription plans have a flat fee that remains the same from month to month. Each monthly subscription includes a certain number of message segments (160 characters) or credits.

So if you intend to send 100,000 SMS texts per month, all you have to do is convert it to the corresponding number of credits or segments. Then, choose the plan that has the volume you need.

If you underestimate your text campaigns, you can typically purchase additional segments or credits at a flat rate. And if you overestimate your volume, you can often roll over unused messaging to the next month.

Tiered Pricing for SMS

Tiered pricing lets you lock in a fixed rate per text based on your monthly message volume. Higher tiers include more messages at a lower cost per text.

Generally, the price differences between tiers equal a fraction of a cent. As you scale your sending, the price differences add up quickly, making it relatively cost-effective to send a large number of messages.

For example, suppose you currently send about 100,000 SMS messages per month. But over the next quarter, you're planning to triple your SMS marketing efforts.

As you scale your SMS marketing campaigns, you might spend less per text as you hit 200,000 per month and even less per message as you reach 300,000 per month.

Factors That Influence SMS Marketing Costs

While pricing varies between different models and providers, the cost of SMS marketing generally depends on a few common factors. Here are a few you should know as you compare text marketing software platforms.

Message Volume and Frequency

Whether you opt for a monthly subscription, a pay-per-text plan, or a tiered pricing model, you'll generally spend less overall if you send fewer text messages. But there's a catch.

Most providers offer a discount to higher volume senders. So if you have a large audience and you use mass texting frequently, each MMS message costs less compared to what lower volume senders pay.

Geographic Region and Carrier Fees

If your subscribers are all located in a specific region (e.g., the United States), you'll pay one standard rate to reach them. But if you have a global audience, your rates will vary.

International SMS messaging almost always costs more, and the rate for each depends on its carrier fees. Some providers also charge additional fees for setting up global texting.

Contract Terms

Some providers offer discounted rates for longer SMS contracts. In the long run, this can lead to significant savings — as long as your needs don't change over time.

Month-to-month plans may cost a little more. However, they offer more flexibility to accommodate changes in sending volume or frequency.

Features and Add-Ons

Some text marketing tools include advanced features in every plan. However, some charge extra for plans that include SMS automations or software integrations.

If you plan to use a dedicated short code (i.e., a memorable 5- or 6-digit number) instead of a long code (a standard phone number) you'll also have to pay an extra monthly fee.

Industry Compliance Costs

A high-performing SMS marketing strategy requires compliance with GDPR and TCPA regulations. Most texting platforms include the cost of maintaining compliance in the monthly plan or the per-text fee.

Comparing SMS Marketing Pricing Plans

To compare the cost of SMS marketing platforms, start by getting clear on your sending volume and frequency and your ability to deal with cost fluctuations.

• If you want to pay a flat fee each month and roll over unused credits, consider a subscription plan.
• If you plan to scale quickly and you want to maximize discounts, consider a plan with pricing tiers.
• If you don't know how much you'll send and don't mind fluctuating costs, consider a pay-per-text plan.

SMS Platform Pricing Red Flags

SMS pricing isn't always as transparent as you might think. Watch for these red flags when choosing an SMS marketing software provider:

• Contract Terms: That low rate may come with strings attached. Some providers require lengthy contracts to lock in discounted pricing.
• Contact Limitations: Don't want your SMS provider to dictate your subscriber numbers? Some require an upgrade to add more contacts.
• Integration Costs: Planning to connect your SMS marketing platform to your social media and email marketing channels? Some providers charge extra for software integrations.
• No Credit Rollovers: You may end up paying for SMS credits even if you don't use them. Some providers don't roll over unused credits from month to month.

Sakari vs. EZ Texting Pricing

Sakari offers transparent SMS subscription plans with a dedicated phone number. Each plan includes a set number of SMS segments with easy-to-understand fees for extra segments or voice calling.

All plans include unlimited users and contacts so you can onboard your team and start growing your list. Our plans are available on a monthly or annual basis so you can choose the right commitment level. If you plan to start scaling your SMS strategy, you can easily upgrade to the next plan tier.

While EZ Texting also offers subscription plans, they're based on contacts rather than messages. All standard plans include a set number of contacts and 500 monthly credits.

If you go over the limit, you have to pay for additional message credits. Since each plan includes a relatively low number of credits, you'll have to check your usage constantly to accurately anticipate your monthly costs.

Explore Sakari’s SMS Marketing Pricing Plans

Maximizing Your SMS Marketing ROI

To keep SMS campaign costs as low as possible, take steps to maximize your ROI (return on investment) from this channel.

Calculate Your ROI

First, clarify your overall ROI from SMS marketing. Use this simple formula:

(Net Profit / Total Investment) x 100 = ROI

Say your net profit for the quarter is $100,000, and your investment is $945 ($315 per month). Your ROI would be:

($10,000 / $945) x 100 = 1058

Monitor Key Metrics

To improve ROI, monitor metrics that reflect engagement and conversions. Track these metrics:

• Unsubscribe rate: A high unsubscribe rate indicates low interest in your marketing messages.
• Click-through rate: A high click-through rate (CTR) means subscribers are engaged with your content and offers.
• Conversion rate: A high conversion rate increases your net profit, which directly improves ROI.

Test and Iterate Campaigns

In addition to monitoring metrics for each SMS campaign, calculate the ROI. Test and iterate to learn which offers, messaging, and frequency lead to the best ROI.

Then, focus on what drives the best performance for your audience. Continue monitoring performance closely so you can adjust your strategy as necessary.

Why Choose Sakari for SMS Marketing?

With Sakari, you get transparent and flexible pricing plans tailored to your business's needs. Each plan includes unlimited users and contacts so you can scale your list without breaking the bank.

You won't find any hidden costs in our automated texting software pricing. Every Sakari plan includes a standard rate, clear costs for overages, and rollover credits for 90 days.

Don't want to commit to an annual plan? We offer monthly plans with competitive pricing so you can manage your marketing budget your way.

We make it easy to build your ideal marketing tech stack, too. Sakari integrates with CRM tools like HubSpot and Pipedrive, communication tools like Slack and ActiveCampaign, and automation tools like Zapier. 

You never have to guess how your SMS campaigns are performing. With our advanced analytics and real-time reporting, you can track the metrics that matter most.

Real-World Example: Cost-Effective SMS Campaign with Sakari

Curious how you can use SMS campaigns to improve marketing ROI? Take a look at Treehouse.

The EV charger installation company struggled to communicate efficiently with prospects. The company also lacked a connected communication strategy across channels.

With Sakari, Treehouse built an omni-channel messaging strategy that connects HubSpot and Aircall. As a result, the company has grown its sales footprint by 400% while expanding its sales staff by just 50%.

Next Steps to Get Started With SMS Marketing

Comparing SMS marketing costs can seem complicated. But when you know the pricing factors that affect the cost and the pricing model that best fits your business, you can choose the ideal texting platform.

Start your free trial with Sakari to experience flexible and transparent SMS pricing. Set up your first SMS marketing campaign in minutes.