Key Findings

When discussing lifecycle marketing, channels like email and social media naturally make their way into the conversation. SMS is often overlooked, even though it brings unique advantages to the customer journey.

Summary

When discussing lifecycle marketing, channels like email and social media naturally make their way into the conversation. SMS is often overlooked, even though it brings unique advantages to the customer journey. When discussing lifecycle marketing, channels like email and social media naturally make their way into the conversation. SMS is often overlooked, even though it brings unique advantages to the customer journey.

The ROI of Text Message Marketing

The Short Answer vs. the Real Story

There’s no single, quick answer to the average ROI of a text marketing campaign.

This channel isn’t a single tactic—it’s a toolbox. Brands use it for reminders, alerts, promotions, recoveries, loyalty nudges, and two-way service. Each use case has different costs, goals, conversion paths, and time horizons. A flash sale might spike same-day revenue; a win-back series might pay off over weeks; an appointment reminder reduces no-shows and saves operational costs rather than driving sales.

The team at Voxie created this eBook to help franchises and other brick-and-mortar businesses quantify the ROI of their own SMS programs and budget with confidence.

Inside, you’ll find a clear breakdown of

Real SMS costs

Platform pricing, carrier fees, SMS vs. MMS, geography, and commitment tiers.

Overlooked Expenses

List building, incentives, creative and ops time, and compliance considerations.

Key Metrics

Engaged subscribers, opt-in opt-out rates, CTR, CVR, AOV, repeat rate, lag to purchase, and attributed revenue.

We’ll walk you through practical ROI models, break-even and payback math, and methods to measure incremental lift—even when sales happen offline—so you can connect in-store transactions to campaigns, compare scenarios, and systematically improve your text marketing performance.

Unpacking the Full Cost of Text Marketing

Before you can measure the performance of your SMS campaigns, you first need a clear picture of what they’re actually costing.

Unpacking the Full Cost of Text Marketing

Most enterprise-level SMS platforms won’t offer simplistic packages at a flat rate, as associated costs are dependent upon the size of the subscriber list, the intended usage, your location, and more. Some software is pricier than others, but here’s a quick look at what you can expect:

SMS Costs

Platforms like Voxie charge around $0.015 per text message.

MMS Costs

Sending an MMS (think images or videos) typically bumps the price to about $0.06.

Software Subscription Models: Flexible or Committed?

When it comes to paying for texts, you have options:

Pay-as-you-go

If you’re commitment-shy, this model gives you flexibility—no pre-set amounts, no worries. But with that freedom comes higher per-message costs.

Minimum Commitment

Locking in a monthly message volume typically reduces the per-message rate, making it more cost-effective for high-volume campaigns.

Voxie chose the minimum commitment model for our customers, and here's why

Larger franchises and companies can benefit from predictable costs and better rates without sacrificing flexibility.

How we find your price

We analyze your historical send patterns—both high-engagement months and slower periods—to set a sensible minimum that reflects your true baseline. You lock in a lower per-message rate at that minimum, and you can always scale up when campaigns spike.

Ultimately, it’s a win-win. You secure discounted pricing without paying for texts you won’t send, while maintaining the freedom to spend more as needed.

Remember:

With Voxie and many other providers, your cost per message typically decreases as your message volume increases.

The Easily Overlooked Expenses of Managing TextMessage Marketing

SMS marketing expenses go beyond the per-message rate. To run a program that actually grows, performs, and stays compliant, you’ll incur a mix of direct and indirect costs across people, process, and technology.

Incentivizing Sign-Ups to Build Subscriber Lists

Factoring in Reduced Profit Margins from Discounts-as-Incentives

The real cost of using discounts to drive opt-ins isn’t just the face value of the coupon—it’s the margin you give up on each redeemed order. Measure impact against contribution margin (revenue minus cost of goods sold, or COGS), not top-line revenue.

While not every purpose who enrolls in your SMS will redeem the coupon or incentive, operate under the assumption that most will. Integrating your SMS software with your POS or CRM, determine the average subscriber-acquisition cost. Compare this against the estimated lifetime value of your SMS subscribers versus your non-SMS subscribers, and you’ll have a clear idea about whether your sign-up incentives are worthwhile.

Partnering with Voxie has transformed the way we approach SMS marketing. Their strategic guidance and deep understanding of the franchise space helped us drive real results, including a 300% ROAS. Voxie has become an essential growth partner for Edible Arrangements.

Somia Farid Silber Edible Arrangements CEO

Factoring in Loyalty Program and Rewards Program Expenses

Look online for loyalty program software, and you’ll see prices as low as $50 - $350 per month. However, these low rates cater to the streamlined needs of eCommerce, not complex, multi-location franchises or chains. For an enterprise-level loyalty program platform, monthly figures can swell to $20,000 - $50,000 per month.

These figures don’t account for the time and resources for software integrations, supporting content like web pages and print materials.

Chances are, your loyalty program exists for purposes outside merely to gain SMS subscribers. Still, you should attribute a fair share of loyalty costs to SMS acquisition if the program is the primary incentive or enrollment path; allocate costs based on the percentage of new members sourced via SMS and include reward redemptions tied to SMS-only offers in your ROI model.

Campaign Management: Time Is Money

Crafting engaging texts, designing visuals, and tracking performance data all require time and resources. It’s easy to overlook these tasks, but they play a crucial role in the effectiveness of your campaigns. Whether you’re managing your SMS efforts in-house on our platform or collaborating with an agency, these activities come with associated costs that impact your overall investment.

Measuring the Return on Your SMS Investment

With your understanding of text marketing costs established, the next step is to evaluate return on investment (ROI). The central question is how effectively your SMS marketing spend translates into measurable business outcomes. Although no single framework fits every organization, accurately tracking the below is foundational to gauging success.

Number of (Engaged) Subscribers

While total subscriber volume indicates potential reach, the more consequential measure is the number of engaged subscribers—individuals who consistently interact with your text message campaigns. In the context of SMS marketing, “engaged” typically encompasses recipients who:

• Open and read messages promptly (as inferred from delivery and response behavior)
• Click links or tap-to-call actions
• Reply to messages (where two-way SMS is enabled)
• Redeem offers or complete downstream actions attributable to the message
• Maintain subscription status over time (low opt-out, stable activity)

Prioritizing engaged subscribers over raw list size better reflects the true commercial value of your SMS program. For example, a list of 1,000 actively engaged contacts will generally produce more conversions—and more predictable revenue—than a list of 10,000 largely inactive recipients.

Revenue Directly Attributed to Text Message Marketing

Attributed revenue is a vital component of your marketing strategy, representing the total income generated directly from your text campaigns. By tracking revenue linked to discount codes or exclusive offers, you can gain valuable insights into the effectiveness of your texts and accurately assess your SMS marketing’s ROI.

Revenue Indirectly Attributed to Text Message Marketing

Calculating the ROI of SMS marketing efforts can be more complex than it may seem. While accurately determining costs is straightforward, tracking conversions with complete confidence can be much more challenging—especially if your business conducts a substantial number of transactions offline.

Consider this scenario: You send a text promoting discounted tacos, and a customer clicks the link to make an online purchase, resulting in an easily trackable conversion. But what if they instead visit your store and buy the bundle in person? And how do you account for their return three days later to buy the same taco at full price?

Moreover, the soft value of effective SMS marketing plays a crucial role in shaping overall brand perception. For example, during a health scare linked to lunch meat, PrimoHoagies swiftly sent a reassuring text to their customers, confirming that their food was unaffected. This built customer trust, but it’s challenging to quantify the “peace of mind” in financial terms.

While no single methodology can capture the full value of text messaging campaigns, the next section will present strategies that provide a more comprehensive view.

Bridging In-Person Shopping and SMS Marketing for Deeper Insights

To create a seamless connection between in-person shopping experiences and SMS marketing efforts, it’s crucial to link customer transactions with their SMS subscriptions. By gathering key customer information and analyzing purchase behaviors, brands can craft more impactful SMS campaigns and refine their understanding of buying patterns.

Collecting Customer Information at Checkout

Encouraging customers to share their phone numbers during in-store purchases is a valuable way to build a database of SMS subscribers who are actively shopping in person. Some effective methods include:

Incentivizing with Loyalty Rewards

Many retailers and quick service restaurants (QSRs) offer loyalty points or discounts to shoppers who provide their contact information at checkout, creating an immediate benefit for the customer.

Integrating with Payment Systems

Connecting payment providers, like Stripe, to SMS marketing platforms helps streamline the process. This integration enables automatic association of in-store transactions with SMS subscriptions, enhancing the accuracy of customer data.

Analyzing SMS Campaigns and Purchase Behavior

Tracking the influence of SMS campaigns on customer purchasing decisions allows brands to see which promotions resonate most:

For instance, if a text message marketing campaign promotes 50% off cookies, observing an increase in cookie sales following the message demonstrates the effectiveness of that particular offer.

While an imperfect system of measurement, running the campaigns repeatedly can help you determine if a pattern emerges in which there is a clear correlation between sales increases and outbound text message marketing.

Case Studies: Showing Real World ROI of Text Message Marketing

SMS Marketing Success Story

This QSR’s Win-Back Campaign Achieved 2,300% ROI With SMS

The Problem

A fast casual franchise with 3,000 locations had invested significant resources building a substantial loyalty membership base. However, they weren't seeing adequate ROI or engagement from their program, with 745,000 loyalty members classified as "inactive"—representing millions in untapped revenue potential.

The Solution

This QSR partnered with Voxie to deploy an automated, behavior-triggered win-back campaign. Through real-time POS and loyalty system integrations, Voxie automatically identified members who hadn't purchased in 90 days and sent personalized SMS messages featuring a $3.00 discount offer.

Key Takeaway

SMS outperformed other direct marketing channels to awaken dormant customer databases into active revenue streams. Even modest engagement gains from high-value customers can drive substantial revenue growth.

SMS Testing Success

A National Food Retailer Turns A/B Testing into 30x ROI

The Problem

A leading gifts and treats vendor wanted to maximize the impact of their SMS marketing but found that their existing campaigns weren’t delivering the desired results.

The Solution

Partnering with Voxie, the food retailer implemented a strategic A/B testing plan to optimize their SMS campaigns. Together, they experimented with different message timings, offer positioning, and order frequencies to identify what resonated best with their audience. The easy measurement and clear campaign comparisons enabled the team to refine SMS marketing hypotheses with each test and optimize tactics.

Key Takeaway

Past underperformance isn’t indicative of future performance. Instead, it can become a roadmap for success when paired with a clear system of testing and analysis. By running structured A/B tests and tracking results through an easy-to-understand reporting dashboard, this food retailer turned missed opportunities into actionable insights.

Ready to Track Real ROI?

Key Requirements to Track Your Text Marketing ROI

After reading this eBook, it should be clear that determining ROI is dependent upon two major software capabilities: campaign tracking and strategic integrations with other software.