Americans send text messages to one another at a rate of over 2 trillion messages per year, and the purposes and uses for them are as diverse as our population. Increasingly, businesses and automated marketing services account for not an insignificant portion of these messages. This leads to a crucial distinction that they need to be aware of when interacting with real people beyond the common-sense compliance measures required by law. Not every text message automated campaign is the same – some are promotional in nature and others are transactional. This distinction could change the way you manage your text message marketing.

Promotional Messages

In the eyes of regulatory agencies and marketers, the terms “promotional,” “marketing,” or “advertising” texts are the same. They promote your goods or services without requiring a purchase. They’re a great way to reach people directly, share fast updates or news, and ultimately increase revenue. However, you must have express written consent to communicate via text message to your audience using an automated system, and this opt-in process can be complicated.

The defining feature of promotional texts are that they simply inform people of your business and its services. It does not require anything in return for the opportunity to share this information with consumers.

Examples of Promotional Texting

Promotional texts can be described as one-sided, in a way. It means that, should someone not receive the message, ignore it, or not take any action after seeing it, there are no consequences. Promotional texts can include:

• Coupons or other special offers
• Announcements related to your business
• Unique opportunities, such as entering a sweepstakes contest
• Requests or calls-to-action

Your marketing strategy might include other types of promotional text message campaigns, but these are common incentives to encourage people to sign up and share their personal information with your organization.

Transactional Texts

Transactional texts differ from promotional ones because they require the recipient to respond or take other action in order to use or take part in your business. They either convey exclusive information, require a response, or compel a person to take action. This distinction is necessary because when someone provides their phone number to you, they must be told clearly and conspicuously that their phone number will not be used for anything other than, for example, verification, unless otherwise specified. If you then take that phone number that was described as used only for identify verification and begin sending automatic messages to it, you can be sued and punished by both telecommunications companies and the government.

Examples of Transactional Texting

Perhaps the most frequent and well-known example of transactional texting often accompanies two-factor authentication. In this security protocol, someone enters a username and password into an online application, for example, Facebook. Facebook then sends a unique code via SMS to the phone number associated with that account for the person to input to the program to access their account. Without the code, they cannot log in. It’s a transaction between Facebook’s automated texting service and the user.

Other examples of transactional text messages include:

• Appointment confirmations (not reminders)
• Password resets
• Tracking online orders
• Reservation confirmations

Any time there are instructions within your automated text campaign to respond whether via text or on a different platform, the text is transactional, and must be described as such when the user provides their phone number.

Why This Difference Matters

Creating effective, compliant text message campaigns requires clear expectations up front. You must specify (correctly) whether the messages people receive from your business are promotional or transactional in nature when they provide their phone number. Doing this leads to a better user experience and protects your organization from liability. There are many players in the regulation of text messages, meaning it can be complicated to know whether your messages might be violating laws or best practices. It’s always better to err on the side of caution when disclosing your marketing efforts through texts.