Laws to stir SMS marketing

SA's SMS marketing is set to see major changes this year with the promulgation of two imminent laws - the Consumer Protection Act (CPA), and the Protection of Personal Information Bill (PPIB).

So says Dr Pieter Streicher, MD at BulkSMS.com, who predicts that thanks to the two laws, South African consumers will emerge as one of the most protected in the world.

According to Streicher, the CPA dictates how and when companies may market to customers, including allowing them to opt out of communications, while the PPIB sets to look at how organisations view, manage and use personal information and sets specific guidelines for how customers opt-in and opt-out of communications.

He adds that the proposed law intends to tighten up the legal details, which allow for far harsher penalties for non-compliance.

In that vein, Streicher believes both sets of legislation apply to SMS marketers.

“To ensure customers opt-in to communications, and then stay opted-in, companies will have to come up with creative ways to provide value to consumers and engage with them in a real conversation.

“The immediate and mobile nature of SMS makes this channel vital in both integrated campaigns, for example, publishing a short code on a billboard to get customers to sign up for a campaign, or as a stand-alone channel, [like] providing customers with information they need on the go, such as weather reports,” he says.

However, Streicher warns, companies should already be in the process of making sure their customer communications are in order, or risk simply being unable to contact a customer legally.

In regards to operators, he says the PPIB will require free opt-out messages be provided. “Currently, only Vodacom offers reverse-billed SMS, so the others will need to find a solution to this,” he explains.

It is also Streicher's view that smartphone growth is showing no sign of slowing down after stellar growth in 2010, adding that analysts seriously underestimated the public's appetite for top-end phones, despite their price tags.

“TomiAhonen calculates there was a 30% quarter-on-quarter growth in smartphone take up in the third quarter of 2010.

“It is unlikely that this smartphone growth trend is going to taper off in the near future, especially with Google's open-source Android platform dramatically lowering the cost of smartphones. SA currently has a 16% smartphone penetration, according to Gartner, which predicts this will rise to 80% by 2014,” he notes.

He adds that SMS has an important role to play in the face of such growth, as a myriad of applications, particularly social gaming apps, incorporate SMS.

Alluding to the power of the SMS, Streicher says: “2010 saw several governments, including India, Egypt and Mozambique limit SMS access during times of violence or political instability; such is the technology's power to spread information.

“However, these shut downs didn't come without cost, thanks to the extent to which SMS is embedded in our social fabric, specifically in the banking industry,” he points out.

Streicher also reveals privacy, which got a massive wake up call in 2010, thanks to Facebook and WikiLeaks among others, is going to continue to play out for years to come, adding that SMS, because of its ease of use and market penetration, is going to remain pivotal in the spreading of information at grassroots level and around the world.

“This is a trend that has been emerging for some time, and is likely to continue and even escalate in 2011.

“In a world of information overload and constant demands for our time and attention, the asynchronous yet immediate, personal and mobile nature of SMS means it is favoured by consumers over other communication channels, especially voice.”