American Marketer


SMS: Thinking beyond the text message

October 21, 2011


By Llew Claasen

There is no disputing the huge popularity of the SMS in the world today. People rarely go out without their mobile phone and, according to Portio Research, the global SMS market is expected to grow from $150 billion in 2009 to $233 billion by the end of 2014.

BBut it is also key to note that SMS is growing far beyond the simple text message.

Instead of social messages such as “See you at 8.30 tonight” or customer service messages including “Your dry cleaning is ready for pick up,” the world is seeing SMS become a powerful tool that extends beyond communication.

SMS is a tool that initiates transactions and carries them out, a tool that provides vital information on-demand, a tool that tracks things in real-time and a tool with unlimited possibilities.

Making things happen

The rapid rise of the smartphone and increasingly intuitive user interface has brought about a dramatic change in how users use and view their phones.

Even in this environment where users have begun to move their messaging to richer platforms, SMS still holds the sway of power because it is the perfect mate for applications reliant on a push notification to get things going in a timely fashion.

Typically, when an SMS message is sent, the message is received by the handset and by default is destined for the on-board SMS messaging inbox.

So, if users are looking for information on restaurants, locations, travel times or whatever it may be, they would generally send a message to a dedicated short code and receive the reply as a message in their inbox.

But where the SMS moves beyond messaging is in its configuration.

If an SMS is properly configured it can be sent to a sender designated port and processed by an application on the handset other than the SMS messaging client. This is done through the implementation of the UDH or User Data Header.

Now, instead of the user receiving the information as a ‘text message’ in their inbox, the received SMS will instead cause the users browser to open and navigate to a specific URL containing exactly the content for which they are looking. So no message, but lots of relevant content – provided by a timely, configured SMS.

Money transfers

Until now, the transfer of money through mobile phones was possible only if both the sender and the receiver held accounts with the same bank.

But this has all changed with an instant mobile payment system which allows transfers to be done using SMS – an SMS that is not a text message, but a payment and money-transfer tool.

This system has been quickly adopted by many banks, and is particularly successful in economically challenged countries as the technology does not require phones to be Internet-enabled.

To start transferring money from their accounts, users first need to register with their banks. The banks then provide them with a Mobile Money Identifier (MMID) and a Mobile PIN (MPIN).

Once they have these, the customer is able to use SMS to transfer money to any account, making payments and transfers a simple matter of pressing a few buttons on a phone. It is both easy and fast, with transactions being done in as little as 15 to 20 seconds.

The service also eliminates a person directly handling cash, while saving on transaction costs and time.

An added bonus is that bankers claim that this system is foolproof and secure because all it involves from the sender's end is a text message in defined format.

Real-time tracking

Another useful application of SMS is as a real-time tracking tool.

Machine-to-machine applications can be configured so that a mobile device automatically sends out real-time location information to a fixed machine. This is preferred over current GPS technology that only sends out periodic messages.

For trucking companies and other businesses that need constant updates to logistical information, SMS is the perfect location tool.

Future of SMS

No other messaging-based service has matched the simplicity, reach, price and reliability of SMS.

The popularity of SMS is growing further with new information services and unique value-added services being used by wireless carriers.

Going forward we will continue to see SMS retain its position as a premium messaging service, but we will also see growth in its ability to act as a useful mechanism for a host of innovative services over mobile networks.

Where the future of the SMS ultimately lies, is anybody’s guess, but it is certainly filled with potential.

Llew Claasen is vice president of marketing at Clickatell, Redwood City, CA. Reach him at