Technology - January 2007

Text Messaging

What Business Owners Need to Know

by Dietmar Petutschnig

A text message, simply put, is a maximum of 160 characters of text you can send back and forth. While cell phone-hugging, text-crazy teenagers are the most visible text-messaging force out there, business people are starting to use text messages to send and receive information with trusted senders and recipients. Yes, texting (SMS technology) has transcended the teen market and moved into big business.

Business owners are sitting down with consultants to map out mobile strategies, just like they did several years ago with Internet strategies.

Business owners, be aware: You won’t be able to broadcast mass SMS messages without getting people to opt in – you can’t blanket entire cities with a coupon. In this medium, marketing needs to drill down a lot further to be effective. A mobile customer relationship marketing (MCRM) system is required as a tool to communicate to “moving target” customers.

For the business owner, texting makes business sense for internal and external communications as a control mechanism. Early adopters included nightclubs and the entertainment industry, which used texting to communicate highly-targeted messages to end users. These days, construction firms may ask crews to use text messages to report locations and job progress to a central database. A restaurant may take down a customer’s cell number and text the customer when a table becomes available; a pharmacy may do the same when a prescription is ready. It’s all about saving time. My father, who owns a logging company in South America, uses texting to collect weigh-station information from his team members. This way, he doesn’t have to buy everyone an expensive laptop.

The financial industry has picked up on this technology as a way to communicate investment information to clients more quickly. The dialogue is far more intimate in business-to-business applications than business-to-consumer, yet tremendous opportunities are available for the retail side as well, utilizing customer needs to enter into a continuous mobile dialogue. In some cases, with high-value information, customers are willing to pay for text messages, so the technology can actually become a revenue stream. We are seeing this in the real estate world, where it’s important to be first. We are also seeing companies push live video to cell phones.

For the business owner looking to explore this technology, the first step is to find out what percentage of your customer and supplier base uses cell phones. Nationally, 85 percent of all people over age 18 and under age 55 have a cell phone. Look into whether you want to use mobile to receive, gather or send out information. (Multimedia and video messaging are also huge right now.)

Even if your business does not plan to use SMS messaging for marketing or communications, you should ensure that your website is easily accessible from a cell phone. Companies are developing special WAP (wireless application protocol) sites that run on cell phones, and some casinos are converting websites to WAP sites.

SMS messages sent this year show a 71 percent increase in monthly volume, compared to last year. Any cell phone purchased within the last three years is capable of receiving a text message. It’s too powerful a force for progressive business owners to ignore.

Dietmar Petutschnig
Dietmar Petutschnig is CEO of AG Nunet, Inc.’s U.S. operations, which are based in Las Vegas, and a partner in the global organization, which has offices in Germany and Dubai.