In recent years, SMS marketing has become an essential channel for many B2B and B2C marketers in Australia. It has a unique set of advantages, such as instant customer communication, personalised messaging, and the flexibility to become a 2-way channel that actively improves customer experience and retention. Yann Burden, chief growth officer at Pendula explores.

However, change is on the horizon. The rise of SMS scams has prompted governments worldwide to implement new regulations, which will force Australian marketers to adapt their campaigns to maintain trust and comply with upcoming laws.

The Australian Competition and Consumer Commission (ACCC) recently reported a significant increase in SMS scams, with SMS messages accounting for 33 percent of scam reports in 2022. This has led to a staggering 469 percent rise in phishing financial losses.

Governments around the world, such as in Singapore and the United Kingdom, have begun implementing SMS ‘sender ID’ registries to protect their citizens from these targeted SMS scams. The Australian Government announced in April that it is also planning to introduce a similar registry, making it crucial for Australian brands to comply with the new regulations or risk having their SMS messages blocked, or worse, incurring fines and damaging their brand’s credibility.

These fines range from minor to quite steep – in 2021, Kogan agreed to pay a $310,800 infringement notice for breaches of Australian spam laws. Given the rise in SMS scams, we expect to see ACMA paying particular attention to this channel in the coming years – the telcos themselves face A$250,000 penalties under new rules announced in July last year. You can ensure this doesn’t affect you by undertaking a thorough review of your SMS campaigns today.

Building trust and ensuring compliance over SMS scams

In this new landscape, trust is a critical metric for marketers using SMS. To maintain SMS as a trusted channel, brands should follow conversational best practices, such as engaging new customers in SMS conversations from day one. Don’t waste the first day – it is the day your customer trusts your communication the most and you’ll be top of mind!

This will also build a history of communication, ensuring customers recognise and trust future messages from the brand. If you keep all your messages consistent with the brand voice used on day one, your customers can then use this to help them assess if your message is genuine or not going forward. This is an under-appreciated factor to bear in mind should you engage in a future rebranding effort too.

While we await the implementation of a true ‘Sender ID’ system in Australia, marketers should consider running “trust” campaigns at regular intervals to assure customers their information is protected, giving them the option to realign how they are communicated with, and reinforcing the value to the customer. If for some reason your brand is not able to be included in Australia’s proposed new ‘Sender ID’ system, this tactic will become crucial to maintaining the viability of the channel long-term.

Another tactic to explore is using a single number for SMS marketing campaigns. Providing clear instructions for customers to store the number can help them recognise your messages quickly and maintain a history of all communications with your brand.

Finally, ensure that you have a proper consent system for SMS communications. This is a non-negotiable essential in today’s environment. Make sure you have a transparent and explicit opt-in process that allows customers to opt out at any time.

Automate and augment

Marketers must stay compliant with local legislation and regulatory changes related to SMS communication, wherever that might be. With so many jurisdictions (including our own) updating their rules to include Sender ID and reduce unwanted SMS messages, it’s going to be far easier to run afoul of the law due to differences in, for example, the UK’s implementation versus our own. Utilising tools that incorporate compliance information and built-in protections can help augment marketers with safeguards, allowing them to operate in this new landscape without becoming legal experts or needing to hire expensive local agencies to manage campaigns on their behalf.

Automation is a powerful way to deliver efficiency and structure in SMS marketing. However, marketers must ensure that automated campaigns are scheduled appropriately and don’t result in an intrusive stream of unexpected messages. Using the right tools to manage both automation and compliance will be crucial for success in this evolving environment.

As SMS marketing becomes increasingly complex due to growing scam threats and regulatory changes, Australian marketers must adapt their campaigns to maintain trust, ensure compliance, and provide excellent customer experiences. By following best practices, obtaining proper consent, staying compliant with local laws, and utilising automation tools, marketers can continue to leverage the power of SMS marketing without playing with fire.

Yann Burden is the chief growth officer at Pendula.