SMS Marketing Pricing – What’s Wrong, And How We Fixed It

SMS marketing pricing has always had one fundamental flaw; that software features and services offered by an SMS marketing platform have always had a direct correlation to the monthly volume of SMS messages.

if-plan-a-didnt-work-photo

What does this mean? To put it simply, you as a business won’t get access to X, Y and Z features, unless you are willing to pay for a certain amount of messages each month. No problem if your intended monthly SMS messaging volumes matches the arbitrary volumes required to gain access to a certain feature set, but in most cases this isn’t the reality. This has always forced businesses to pay for a significant amount of messages each month that they aren’t going to use, so they can have access to a feature that is critical to the success of their SMS campaign. Doesn’t seem right does it?

We didn’t think so either, so over the last six months the team at Tatango explored hundreds of different SMS marketing pricing options, and we came up with something unique. Below I explain our reasoning behind our new pricing model, and as always, if you have any questions, comments or feedback, feel free to contact us, or leave a comment below.

The first thing we decided on was that we needed to separate the cost of messaging from the cost of the features and services, ensuring that brands would never again be forced to purchase more messages than they needed, in order to gain access to an SMS marketing feature or service critical to their campaign.

The Breakup

Monthly platform fees have no messaging costs baked into them, allowing you to compare the different platform options based solely on your campaign needs. No more sacrificing features and services if your monthly SMS messaging volumes aren’t high, or paying for more SMS messages than you’ll ever use, to get access to a critical feature or service.

Once we successfully separated the cost of the features from messaging, it was time to figure out a method to bill for the SMS messages. There were a ton of options here, and trust me we explored them all, but in the end we decided that charging a simple flat rate per SMS message made the most sense. Why? During the last couple of years we’ve seen a huge shift to the commoditization of SMS, with the demand for SMS messages being supplied without qualitative differentiation across SMS marketing platforms.

commodities

Other examples of commodities include copper, gasoline, gold, steel, water or even salt, because let’s face it, do you really care where your salt comes from or who made it? The same can be said with SMS messages sent through short codes, as no matter what SMS platform you’re using to send messages, they’re all eventually going down the same pipeline to the wireless carriers.

The commoditization of SMS messaging was another reason why we decided to separate the cost of the features and services we offer at Tatango from the messaging. While SMS messaging has become commoditized, features and services are far from a commodity in our industry. As other SMS marketing platforms have relied on the shrinking profit margins of SMS messaging to cover their operating expenses, Tatango will be continue to provider the same great support, product innovation and industry expertise as we always have, even when offering our messaging at cost to our clients.

What do you think about our new pricing model here at Tatango? Let us know in the comments section below, or  if you have any questions, comments or feedback, feel free to contact us.

 


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