Transactional SMS vs Promotional SMS: What Indian Businesses Must Know
A shop owner in Lucknow once asked a simple question. Why did his order confirmation SMS reach every customer instantly compared to his festival discount SMS, which only reached half of his customers? Both were sent from the same phone, on the same day to everyone on his list.
The answer had nothing to do with the offer or the timing. Instead, it had to do with one thing that most business owners do not think about. Transactional SMS vs. promotional SMS in India are two completely different things, and there are rules as to when they can be blended (which often results in a loss of reach for businesses).
This is something that a lot of businesses deal with, and it does cost money. Understanding this before you start your next SMS campaign can save you from having messages that are blocked by TRAI and losing money on marketing.
What is a Transactional SMS?
A Transactional SMS is linked to a service that a customer has actively requested or is currently involved in. It can be used to inform, confirm, or update the customer and does not include any offer or attempt to sell anything.
Since this is a transactional SMS, it is sent with the customer's consent, and is not blocked by DND (Do Not Disturb) registration since this is not a promotional SMS.
Section 1
Common Examples of Transactional SMS
SMS messages used as one-time passwords for logging in or for authorizing a payment are examples of transactional messages. Many organizations send order confirmation, delivery status, appointment reminders, payment receipts and even alerts regarding changes to customer accounts. Confirmation of a booking, shipment of an order, alerting of the balance in an account are all examples of transactional messages.
What Is Promotional SMS
Promotional messages are messages sent to advertise a product, service or offer. Examples include offer messages, announcements of new products, new service messages, messages about upcoming events, messages about sales, and messages informing customers about upcoming festivals and special sales.
Because promotional messages are categorized as a marketing message, they must be sent via an authorized promotional message route, fall within the time frames approved by TRAI, and be sent with the customer's consent.
Common Examples of Promotional SMS
Messages sent by a store advertising a Diwali sale, messages sent by a coaching institute advertising a new batch, messages sent by a real estate broker advertising a new project, and messages sent by a salon offering a discount are all classified as promotional SMS.
Section 2
The Real Difference Between Transactional and Promotional SMS
The primary distinction that matters is intent. Transactional messages relate to a service the customer has already requested and promotional messages aim to advertise. There are three outcomes of this distinction that relate to consent and the DND rules.
Transactional SMS
Transactional messages don't require a customer's consent and are not blocked by the DND service, as they relate to a service already requested by the customer.
Regarding Promotional & Transactional SMS
TRAI mandates marketing SMS be delivered during business hours - between 9 AM and 9 PM. Transactional messages regarding OTPs or delivery status updates do not require compliance with these restrictions.
Sender ID & Routes
TRAI mandates different Sender IDs and distinct routes for transactional and marketing messages. Most Indian businesses cite using the incorrect marketing route as the primary reason for their marketing campaigns being blocked.
The Importance of this Distinction for Compliance
TRAI prides itself on the strict enforcement of SMS routing mechanisms. From the perspective of DLT registration, it emphasizes that each unique Sender ID and message template is classified as either transactional or marketing prior to the actual authentication process. Failure to comply will result in the message not being delivered to the client.
Where do Penalties Come into Play
Transactinoal messages should not be used for marketing activities as this risks losing the Sender ID and the impact of this is felt across all marketing activities of the business.
What Kind of SMS do you Need for your Business
Most businesses in India require both for their various use cases.
When to Send Transactional SMS
Send transactional SMS for messages that the customer is actively waiting for - order status, appointment reminders, OTPs, alerts for transactions and other update messages - which should be sent instantly and reliably to boost customer satisfaction.
When are Promotional SMS Appropriate?
Promotional SMS can be employed when aiming to generate brand awareness and new business. These SMS include market offers and new products, sales and event announcements. If you are sending promotional SMS, customers must have given you permission, and you must have a registered promotional SMS template.
Combining Transactional and Promotional SMS
The best SMS marketing strategies utilize transactional SMS to notify customers of important updates while utilizing promotional SMS to drive new business or to drive repeat customers. Failure to separate the two is the primary reason campaigns do not succeed.
Typical Mistakes Indian Businesses Make
Many businesses in India register for a transactional SMS route, and then send their festival promotions through that route. This will not work. Others send important service update SMS through a promotional template, which causes delays for the messages during the 9AM to 9PM business hour window causing the messages to be unhelpful to customers who are waiting to receive the information.
Also, some businesses send marketing promotions through unregistered promotional routes, and when the unregistered SMS promotions get through, their delivery rates are poor. These mistakes are usually not obvious until delivery reports are checked, and at that point, weeks of lost campaigns are revealed.
Closing Remarks
Transactional SMS vs promotional SMS India should be approached with care, as it can affect the visibility of all your marketing offers, and the effectiveness of important business updates. The order delivery updates, and promotions will then reach the intended recipients. Getting everything right to start will protect delivery rates and SMS sender reputations.
If you're seeing a dip in campaign performance and aren't sure if it's a routing issue, it may be worthwhile to have your configurations reviewed before sending another campaign.
Frequently asked questions
What is the primary distinction between transactional and promotional SMS?
Transactional SMS supports a given service and does not require any kind of marketing opt in. Promotional SMS requires opt in and an active marketing route.
Can transactional SMS be sent without opt in?
Yes. Transactional SMS can be sent regarding a service the customer has previously opted in for, such as an OTP or order status notification.
Does DND block promotional SMS?
Yes. Promotional SMS will not be sent to DND registered numbers unless the customer has opted in to receive marketing messages.
Can promotional SMS be sent at anytime of the day?
No. Promotional SMS can only be sent between the hours of 9AM and 9PM according to the TRAI.
Is an OTP SMS transactional or promotional?
OTP SMS is transactional since it is related to a service and not marketing.
What happens if I send promotional content using a transactional route?
The message gets blocked and there is a chance that your sender ID will be blacklisted.
Do transactional and promotional SMS cost the same in India?
The pricing varies based on the service provider and volume, but promotional SMS is usually charged separately due to the distinct marketing route and consent requirement.
Do I need different DLT templates for transactional and promotional SMS?
Yes. Each message type requires its own registered template and marketing route.
