The U.S. business messaging landscape is undergoing a massive shift.
New US A2P 10DLC (application-to-person, 10-digit longcode) requirements present both challenges and opportunities as the entire industry responds and adapts to it.
For many businesses, this transition means a major change for how they message their consumers, and there are complexities and nuances to navigate as we all make our way through this shifting landscape, together.
Let’s look at the bigger picture of business messaging and its future, what A2P 10DLC means for many of us, and how to emerge from today’s challenges as a communications leader tomorrow.
The power of SMS in business
There is one huge reason the shift created by A2P 10DLC is causing such massive shockwaves throughout the business world: SMS is a critical part of many company’s business strategy, and for good reason.
In just a few years, we have gone from businesses communicating via one telephone line, to personalized text communication tailored to a consumer’s interests and needs. By 2022, businesses will have sent a collective 2.7 trillion messages.
The facts paint a clear picture of the “why” behind the popularity of SMS for business.
For one, it’s incredibly effective. In a recent study from Stanford University School of Medicine, patient response rate to text messaging averaged 91 percent higher than response rates of daily phone contact for patients—and that sort of engagement is the norm, not the exception:
- 98 percent average open rate for SMS,
- 90 percent of messages are opened within first three minutes,
- 45 percent average response rate.
SMS also provides global reach, since you don’t need an app or even data to engage with it. And, it has a high ROI: Twilio’s own research shows a 78 percent increase in end customer lifetime value when businesses provide personalized experiences via SMS.
And in 2020, COVID-19 amplified the power of SMS even more.
COVID-19 and digital acceleration
By now it’s clear: COVID-19 took the digital transformation process many businesses were already undertaking and threw lighter fluid on it.
High-value customer engagement experiences became more critical than ever, as our own State of Customer Engagement report showed. It found that:
- 96 percent of businesses report that NOT digitizing customer engagement would have negatively impacted their business;
- 43 say they would have lost revenue;
- 43 percent say they would have been unable to meet customer expectations.
Now, messaging between businesses and consumers isn’t a “nice to have;” it’s a prerequisite for success:
- 87 percent of businesses report digital customer engagement will be critically or very important to their success going forward;
- 95 percent expect to increase or maintain their organization’s investment in customer engagement after the pandemic;
- 91 percent say they are more likely to build communications solutions to meet customer demands in the future.
So just as messaging has become more critical than ever, A2P 10DLC comes along and provides a new opportunity for increased trust in the business messaging world.
Why A2P 10DLC?
As critical as SMS is for consumer engagement, it’s also not optimized to deliver the best consumer experience or business outcomes.
Consumers want the right message, at the right time, on the right channel. And they want more control, too. Our research found:
- 93 percent of consumers want to specify the frequency with which they receive messages;
- 92 percent say information they receive is often or sometimes not useful;
- 63 percent expect to be given the choice to opt in to messages from a business.
So, while SMS can provide huge returns, it has to be used correctly to do so. Incorrect usage creates a negative consumer experience, and that’s happening with increased frequency. We’re all experiencing an increase in unwanted messages and spam, so much so that the WSJ reports a 1.3-times increase in FTC spam complaints between 2019 and 2020.
Poorly timed, unwanted messages aren’t just bad practice. It erodes consumer trust, leads to significant filtering that prevents critical messages from getting through, and can impact all businesses in terms of consumer behavior toward SMS in general as well as carrier disruptions due to unwanted traffic.
Once a consumer opts out of messaging because of a poor experience, it’s hard to win them back. That’s where A2P 10DLC comes in.
Challenges now for a better tomorrow
The changes brought about by A2P 10DLC are designed to improve consumer trust and the ROI of every message sent.
Consumers trust verified ecosystems. When a business’s messaging is verified, consumers show as much as a 27 percent increased likelihood to buy from that business. Companies also see a 16 percent increase in brand perception when their messages are verified, and nearly 70 percent of users trust a business more after they’ve messaged with them.
The increased transparency and accountability A2P 10DLC brings is not new, either: it’s been in the works across all business messaging channels, from SMS and MMS number types to verification on channels including verified SMS and WhatsApp.
While it does require effort and bring higher costs, A2P registration combines the value of a trusted, verified ecosystem with the added value of a local, recognizable number—something previously unattainable.
With registration, consumers engage via a trusted ecosystem with reduced spam, keeping SMS a value-adding, high-engagement channel.
New business-specific routes for A2P messaging also provides higher throughput, meaning businesses can reach more people, faster.
And the trusted ecosystem also improves deliverability across the board, since carriers know a business’s messages are verified, resulting in higher trust, improved deliverability, and less filtering.
The opportunity A2P represents
This shift is not just about one major change in requirements. It represents an opportunity to innovate and reinvigorate your business’s message frameworks on a much larger scale.
Twilio’s committed to partnering with you to ensure you’re current on the latest regulations, and the tools and strategies you employ aren’t just about dealing with the latest challenge that 10DLC represents, but setting your business up for success in messaging moving forward.
With the Twilio Super Network, businesses get the reliability and redundant connectivity to conduct business globally.
That scale is critical, but so are local experiences, and our number library spans across A2P number types and lets businesses reach 6+ billion people spanning 180+ countries.
At the core of it all? Trust. Twilio provides the tools and features that promote lasting, trusted relationships between businesses and their customers, through everything from our Trust Hub, privacy offerings like HIPAA eligibility, and compliance management tools through Advanced Opt-Out for localized experiences that ensure compliance.
The future of business messaging is here, and we’re ready to help you navigate it to emerge as a leader tomorrow. Get in touch to learn more.