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An Introduction to Two-Way SMS Communications

The 28th anniversary of text messaging is quickly approaching. It’s hard to believe how far we have come since the very first text message was sent way back in December 1992. Today, we send 7 billion text messages each day in the United States and 20 billion messages are sent worldwide (Forbes).

Text messaging enables us to share brief snippets of information with a single person or a group of people. In the early days of texting, the primary use was person-to-person messaging, also known as peer-to-peer messaging. Over the course of the last three decades, businesses have begun to embrace text messaging as well. We are now seeing business text messaging grow in popularity and become commonplace. In fact, SMS messaging is one of the fastest growing channels for business communication. Business text messaging is not just for traditional marketing campaigns and outreach efforts but also customer notifications and important account-related messages.

A conventional starting point for business text messaging is simple one-way alerts from the brand to the customer. The natural progression from there is two-way texting as customers respond to the messages they receive from the lenders. From a lender’s perspective, a two-way SMS platform incorporates not only outbound messages but also includes inbound text messages as part of an omni-channel communications strategy. Lenders that add the SMS channel to their communications strategy find that customer engagement with SMS and the related costs far outperform traditional communication channels such as phone and email. From a customer’s point of view, text messaging is much less intrusive and a more efficient way to engage.

Many lenders that start out with one-way text messaging to send campaigns to large groups of customers very quickly find out that their customers respond to their text messages. The responses can be as simple as the customer providing an update to the lender , asking a question related to their account, an issue they are facing, or to give feedback based on their experience. When brands review these inbound responses, they find each response is a crucial opportunity to build rapport and promote a direct relationship with each customer.

Starting a Meaningful Conversation

Two-way text messaging is akin to creating an ongoing conversation with a customer. It generally begins with providing important information to the customer in a timely manner. A few real-world examples include sending an appointment reminder, providing a short reminder of an upcoming payment that is due, sending a marketing offer that is consistent with a customer’s interest, and a gentle reminder if a payment wasn’t received on time. Lenders must make sure they are providing information on a consistent basis because customers really do want to communicate with them on this communication channel. Much like the text message conversations with their friends, the SMS channel enables the lender to enter the customer’s inner circle of trusted relationships.
Though most companies know that customer communication is important, they often do not know where to start, and that is the easiest piece of the puzzle. Sending a simple “welcome” message to a new customer is a great way to start the relationship and conversation. Not only is the customer delighted but it is the start of an entire journey between the brand and the customer. In the event an unforeseen issue should crop up further down the customer-brand journey, the initial “welcome” message offers the customer a sense of security with the SMS communication channel and a way to engage with the brand.

Compliance – The Cornerstone of Text Communications

Before lenders can begin engaging with their customers via text messaging, it is important to note and recognize that compliance forms the foundation of the SMS communications channel. In the United States , the federal TCPA (Telephone Consumer Protection Act) law forms the basis for SMS communications. To start conversations with customers, companies are first required to gain written, explicit consent from the customer before they can communicate with them through text messaging. Once permission is obtained and customer consent is confirmed, companies can deliver their messages to their customers and respond to replies.

The primary areas lenders must consider before embarking into text messaging are acquisition of customer consent for SMS messages, how they will maintain ongoing documentation of the customer’s consent, what types of critical information they plan to deliver, and allowing customers a way to retract consent and opt-out of texting communications.

Effective Communications

While we’re sending and receiving billions of text messages every day, it’s also interesting to note a couple of additional stats about engagement: 98% of text messages are read in three minutes with the average response time of 90 seconds (Forbes), and 80% of consumers prefer brands to communicate with them by text (Ring Central).
The real power of two-way texting is that it enables customers to feel like they are having a personalized experience with the lender. After the initial “welcome” message, companies must have a thoughtful contact strategy to deliver information about updates, potential issues, promotional offers, surveys, and alerts. While lenders emphasize workflows, engagement metrics, NPS (Net Promoter Score) measurements, preferences, and intents, their customers consider consistency of communications, the useful information content they receive, and the ability to communicate with a company across a spectrum of channels.
Another key factor to consider is timely responses to inbound customer messages. This step is critical because the customer has selected to respond at a time that is convenient for them, and it could be related to an important issue they want to discuss. To ensure effective communications, companies must follow a sequence of essential steps. First, they should review the types of replies they are already receiving from customers to recognize common trends or issues. Next, they should identify and select the appropriate staff members that can communicate with customers about those issues and queries. Finally, they must provide the necessary training to selected staff members to ensure they are successful from the start.

Final Thoughts

Two-way texting is a promising new channel of communication for lenders that decide to engage with their customers more deeply. Most of the customers desire to have a text conversation with a business because it is simple, effective, and quick. Not only is it a less intrusive way for them to engage with a company , but it also takes away the embarrassment when discussing a sensitive topic. The real beauty of two-way texting is that it can benefit organizations of all sizes and empower connectivity between the organization and the customer. As lenders shift from simple one-way text messages to rich conversations via two-way text messaging, they are sure to gain advantages in terms of trusted relationships with customers, deeper knowledge of customer behaviors, and expansion of the customer journey across other product and service offerings.


Vivek Rao is Senior Vice President of Product at Solutions by Text.

To learn more about Solution By Text visit:

Nortridge customers can start using 2-way texting to improve collections, and deepen the relationships with their customers. Get started here.

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