Recent research shows that the A2P SMS market is not only growing, but its use is also diversifying.
SMS accounted for 96% of the total business messaging spend in 2022, with 10% more businesses spending on SMS following the disruption around the globe caused in 2020.
It’s important for businesses to understand where A2P SMS is headed. As such, our guide will cover the future of A2P SMS, including the market growth as well as how it can be used by businesses and consumers as a messaging channel in the future.
When trying to understand what the future looks like for the A2P SMS industry, factors to consider include, but are not limited to:
- Market growth
- Rainbow traffic
- Future use of SMS
1. Market Growth
SMS remains superior as a critical messaging channel, and the A2P SMS market continues to grow.
In fact, forecasts from Mobilesquared project that the A2P SMS industry is set to grow by 87% between 2019 and 2025, emphasising not only the growth of the A2P SMS market as a whole but also why businesses should be using it.
So, what does this market growth mean for businesses? In short, it means that A2P SMS isn’t just relevant in 2023, but is the future, and a bright future at that, hence why the number of businesses using SMS to communicate with customers (A2P) increased by 9.78% by
the end of 2022 compared to the previous year.
The exponential growth of the market and the fact that SMS remains an effective way to quickly communicate with customers, offer personalisation, and create highly targeted experiences for customers, means that buying SMS data has thus never been more valuable.
Implementing SMS into your way of working, then, allows businesses to promote superior customer satisfaction and build strong client relationships as a result.
2. Rainbow Traffic
Until now, it has been the industry standard for A2P SMS traffic to be split into white and grey traffic. At Mobilesquared, we believe this is a somewhat reductive way to look at traffic, and are adopting a new approach to view it through a more comprehensive lens: rainbow traffic.
We’ve adopted rainbow traffic to emphasise the impact different traffic types have, not only on the mobile operator but also on businesses and consumers.
White route SMS traffic has been recognised as official traffic in the industry, but according to the Mobilesquared A2P SMS global forecasts, grey route traffic still accounted for about 25% of total traffic in 2022 and continues to increase.
Although grey route traffic has historically been associated with fraudulent traffic, not all grey traffic is fraudulent, so this becomes a reductive descriptor. As such, this will now be referred to as “harmless grey traffic” by us at Mobilesquared.
Our rainbow traffic model is simple. Orange traffic is “SMS traffic that is potentially harmful to the consumer”, while red traffic is “SMS traffic that poses a potential or real threat to the consumer and potentially damages the sender business’ brand reputation”, making it harmful.
Both Artificially Generated Traffic (AGT) and Trashing are considered to be white route traffic fraud. To differentiate these practices from white route traffic, then, Mobilesquared has labelled this traffic to be blue.
We’ve applied a rainbow of colours to A2P SMS traffic that better reflects how certain traffic types can impact the business sending the SMS and the consumer receiving the message. However, we don’t expect the whole of the messaging industry to adopt or embrace our approach to traffic types.
That said, this revised approach is important to consider when looking toward the future of A2P SMS as a whole, as it can help to bring greater clarity to what is occurring in the industry whilst reflecting what that traffic actually indicates.
3. Future Uses Of SMS
The future looks bright in terms of the uses of SMS from a business and customer perspective.
From a business perspective, A2P SMS already has a range of uses that will only increase as technology develops.
From appointment reminders to marketing messages, SMS remains an important part of improving the customer experience and there are a range of advantages of using SMS in business.
Marketing strategies for SMS have evolved and matured over the last few years. With the rise of automation, SMS will continue to make it easier for businesses to focus on customising messages to customers, in turn improving engagement rates and customer satisfaction.
Additionally, businesses will be able to integrate SMS with emails, social media platforms, and even customer relationship management (CRM) software to develop marketing strategies that reach customers wherever they may be.
How you use A2P SMS will depend on your goals as a business, but its flexibility means you can easily tailor it to ensure you’re getting the most out of your marketing efforts.
With the increase of wearable technology in the form of watches, jewellery, medical devices, and accessories, it’s never been easier to stay connected even when customers are away from their phones.
We’ve already seen the development of smartwatches, such as the Apple Watch, which allows you to send and receive SMS messages if your iPhone is switched on and connected to the network even when you’re out and about away from your smartphone.
This highlights a unique opportunity for businesses to reach customers, even when they’re out of range through wearable technology.
As wearable technology becomes more sophisticated, then, it’s likely SMS will be introduced into various different devices, providing even more opportunities to connect and communicate with customers.
Hopefully this guide has given you a wider perspective of the future of A2P SMS.
We are Mobilesquared: mobile engagement specialists delivering the very best independent mobile market intelligence to our clients. We are the established #1 global authority on business messaging and CPaaS, with our data shaping business plans, strategy, and customer engagement modelling, for some of the world’s leading brands, mobile operators, and messaging providers.
To learn more about our services, including the Messageverse, be sure to get in touch via telephone (01182149 777) or email (email@example.com) to find out about what we do and discover how we can help your business.Written by Jemima, for Mobilesquared.