Your Digital Marketing Budget: How Much Does a Short Code Cost?

In this day and age, companies are wise to bring SMS marketing into their outreach strategy. Customers are more connected than ever and the role of mobile phones in day-to-day life is significant. In fact, there are more than 5.2 billion unique mobile phone users worldwide.

With the proliferation of online shopping and the ability to tap-and-go at brick-and-mortar stores, mobile phones are becoming an indispensable part of daily life for many. A large proportion of the modern population say they would rather forget their wallet at home than their phone, making it the best and most accessible means of reaching potential customers.

A modern marketing strategy isn’t complete without SMS marketing. While this approach will create more opportunities with potential and current customers, you should also be sure to write it into your budget. In this article we’ll go into one crucial aspect: what a short code is and how much a short code costs for SMS marketing.

SMS Marketing

It’s not just about what you want to say, but what your customers will hear and understand – that’s what a good marketing strategy is built upon. While flyers in the mail or ads in the back of the newspaper were once effective, the world has moved into new territory. Customers are more annoyed than intrigued by mass mail campaigns for example, so it doesn’t make sense to invest your money there.

SMS marketing is flexible and more personal than an email newsletter. SMS are also less likely to be buried in an inbox or mistakenly moved to a spam folder. Sending messages to subscribers is easy using your own short code.

When considering how much a short code costs, there is an initial investment in order to start sending mass SMS to your contacts. From there, the investment and maintenance are minimal. You can easily begin sending SMS for lead generation, promotion, proactive reminders, and much more.

Related: SMS Short Codes for Marketing

Shared vs. Dedicated Short Codes

Short codes are unique identifiers that are used for sending business SMS – think of a short code as a five- to six-digit phone number. These numbers can’t receive calls but are recognizable as the sender of the SMS marketing messages you send to your customers.

Shared Short Codes

Once upon a time, shared short codes were popular in the business world. These numbers were used by multiple companies, giving them a chance to lower the cost for short codes by dividing up the bill amongst everyone. While this may seem like a good idea, it was not without its issues.

Shared short codes were used by companies unrelated to one another who were oftentimes not in contact with each other. While the cost was lower, the risk was a bit higher. Companies were affected by the business practices of other brands using the same number.

If another brand was too regular or pushy with its messaging, it could have an effect on the others. It was also challenging for customers to unsubscribe from one brand’s communication without potentially missing messages from others.

Mobile carriers facilitate the distribution of messages via short codes. When they recognized the potential of spam messages from shared numbers, they took action by blocking the use of shared short codes. While you may have heard of shared short codes, they’re no longer an available option.

Dedicated Short Codes

Thankfully, the block on shared short codes didn’t put a stop to SMS marketing altogether. Dedicated short codes are still alive and well, and are more effective than ever. By having a dedicated short code, brands can be sure that the communication their customers receive is in alignment with their strategies.

Dedicated short codes are exactly as they sound: numbers that are used by a single brand or company. While having a dedicated number means the cost for a short code goes up, so does your ability to control the messaging that goes out from your number. With a more deliberate and controllable outreach, your conversion and retention rates also increase.

Now that you don’t need to decide between a shared or dedicated number you can more reliably predict at least part of how much a short code costs. But there is more to consider, and that starts with getting your own short code.

Related: Vanity vs. Non-Vanity Short Codes

Vanity Short Codes

Your short code will be recognizable by your recipients, but that’s not all. When incorporating SMS into your digital marketing strategy, you will likely add your short code to materials such as newsletters, banners, social posts, and more. You’ll share your short code to encourage subscribers.

As short codes are shorter than phone numbers they are easier to remember. That said, there are some that are more memorable than others.

The lower cost for a short code is to have your number selected at random. You’ll receive your short code during the setup process and it may or may not be a number that rolls off the tongue.

Vanity short codes put the power of choice into your hands. Select a number that is memorable, either due to sequence (think 12345 or 121212), or by spelling out a word related to your brand on the keypad (like PEPSI). Much like vanity plates on your car, these numbers stand out. Of course, they come at a premium. How much a short code costs will depend on how much say you have in those numbers.

Buy or Lease?

Obtaining your short code is a bit akin to your website domain. While the address of your website is dedicated solely to your business, it doesn’t technically belong to you. Holding the web address depends upon a regular subscription payment to a domain provider.

The same is true of your dedicated short code. The number is yours on a yearly subscription basis. This subscription is paid to the US Short Code Registry, the only governing body holding access to these short codes.

The cost of a short code is $500 per month to lease a randomly generated number and $1,000 per month for a vanity code, , but those doesn’t include carrier connectivity costs. For $800 – $1,500 a month, you can get carrier connections included. You may choose to lease your short code for three, six, or 12 months at a time.

Additional Costs for Short Codes

In addition to the lease, there are other costs for a short code that you should take into account: 

Provisioning

The short code provisioning process can be arduous for businesses without experience in the workflow. SMS aggregators and application providers often offer support in ensuring that your application is filled out fully and is approved by the US Short Code Registry without hassle.

While this service is invaluable, it also contributes to how much a short code costs. This is a one-time setup fee that should be factored into the process. Approval can take 4-8 weeks, a timeline made even longer if you have to go back and fix your application. It is recommended to include provisioning support in your budget on the cost for a short code.

Hosting

Many SMS aggregators or application providers will charge a fee for hosting your short code on their system. Research with your application provider to understand if this will be a recurring bill to put into your budget.

SMS and MMS Messaging

Another cost for short codes arises when you begin sending messages. SMS aggregators or application providers may charge a fee for the text or visual messages you send. When selecting a platform for message creation and distribution, make sure you understand the billing model fully. Check with your wireless carrier as well, as they may also have messaging fees.

Platform Provider

Sending business SMS is slightly different than you’re used to. Instead of opening your phone, crafting a message, and hitting send, you’ll instead do this from an application provider. These platforms are created for business SMS and allow you to create messages to send to your audience or a subset of your subscribers. 

Some providers offer codeless integrations with other platforms, such as a CRM. That means users can text directly from their CRM tool instead of toggling back and forth between systems. As with any software provider the fees vary depending on who you choose, so research the cost when designing your budget.

When you’re ready to get into the world of SMS marketing, your best ally is your SMS platform. TrueDialog’s system is made simple for small businesses with all of the scale and functionality required by big companies. We’ll help you reach the masses with personalized customer engagement through text messaging.

 

Disclaimer: Please note that this advice is for informational purposes only and is neither intended as nor should be substituted for consultation with appropriate legal counsel and/or your organization’s regulatory compliance team.