SMS Compliance in the U.S [Complete Guide]

SMS marketing is a direct way to reach customers, but it comes with a set of important rules designed to protect people’s privacy. To prevent serious legal issues, you need to know these SMS compliance guidelines before you launch your campaigns.

Compliance is key to building trust with your customers. When you respect their privacy and send messages they’ve agreed to receive, they start to trust and feel more comfortable with your brand.

Trust is essential, especially now that people are very cautious about how their personal information is used.

Understanding and implementing SMS compliance protects your business from hefty fines and legal problems, which could also harm your reputation.

Let’s look at how you can integrate these rules into your marketing strategy, turning them into an opportunity to engage and retain your customers.

What is SMS Compliance?

SMS compliance ensures that marketing text messages sent by businesses adhere to legal and ethical guidelines, especially for marketing purposes.

These guidelines protect individuals from unwanted messages and clarify the sender’s identity and message purpose. 

The Telephone Consumer Protection Act (TCPA) is a primary regulation in this area, particularly affecting businesses in the United States. Companies must get permission from individuals before sending them marketing texts.

This law helps prevent people from receiving spam texts and ensures that companies only send messages to those who have agreed to receive them.

Why SMS Compliance Matters for Businesses

Whether you’re a small business or a large corporation, SMS compliance should be a priority. Failure to comply can lead to fines, loss of customer trust, and potential damage to your brand. 

Here are key reasons why it’s important:

Build Trust With Your Audience

When you only send messages to those who have opted in, it shows respect for individual choices and privacy. Clear communication about who is sending the message and why helps customers feel secure and confident that they are not being misled. 

A simple way for customers to opt out shows value to their preferences and satisfaction. Additionally, prompt and personalized responses to replies show attentiveness and build a deeper connection. 

Avoid Legal Issues

Legal frameworks such as the TCPA in the United States provide clear guidelines about consent, privacy, and consumer rights, especially as it relates to promotional type messages.

As you will learn later in the document, customer service or transactional type messages, do not need to meet these strict requirements.

TCPA fines can be quite steep, ranging from $500 to as much as $1,500 for each willful violation. A willful violation means that a business knew that what they were doing was against the rules but chose to proceed anyway.

Beyond the financial implications, non-compliance can cause reputational damage, which leads to lost customer trust and negatively impacts business relationships.

Protect Brand Reputation

When a company consistently follows SMS laws, it tells customers and the wider market that it values honesty and customer rights. This can lead to stronger customer loyalty, as people are more likely to stick with and recommend companies they trust. 

Also, having a good reputation for compliance can make your business more attractive to potential partners and investors who are looking for ethical companies.

Following reputational damage, you may also see a decline in your customer base. Customers who are irritated by non-compliant communication practices are more likely to opt out and seek services or products from your competitors.

What Are TCPA And CTIA Guidelines?

Cold texting, or sending unsolicited marketing type text messages to customers who haven’t agreed to receive them, is illegal. Businesses must obtain consent to avoid legal penalties. 

There are two critical sets of regulations that govern the use of telecommunications, including text messaging. Here’s a breakdown of each:

TCPA (Telephone Consumer Protection Act)

The TCPA was enacted in 1991 by the Federal Communications Commission (FCC) in the United States to address a growing number of consumer complaints about telemarketing calls.

Its rules are designed to protect consumers from unwanted phone calls and text messages:

• Businesses need to obtain express written consent from people before they can send them promotional texts or calls. This consent must be clear and unambiguous.
• Every SMS message must provide an easy way for consumers to opt out of future messages. 
• Limited telemarketing calls between 8 am and 9 pm local time.
• Businesses are required to keep records of consumer consent and other compliance documents for at least five years.

CTIA (Cellular Telecommunications Industry Association)

The CTIA is a trade association representing the wireless communications industry in the U.S. Their guidelines extend beyond basic compliance to offer marketers detailed instructions for better customer experience in SMS marketing.

These guidelines emphasize the importance of transparency and clarity in communications. 

For example, they suggest that every marketing message displays a clear call to action to ensure that customers fully understand what they are opting for.

Additionally, the guidelines mandate a clear and quick opt-out process if customers choose to discontinue receiving messages.

Also, to maintain transparency and build trust, every text sent to customers must include the brand’s name, ensuring that recipients know who is contacting them.

Common Pitfalls to Avoid For SMS Compliance

SMS compliance is essential for businesses to maintain good relationships with customers and avoid legal issues. However, several common pitfalls can jeopardize compliance efforts.

Being aware of these mistakes can help you familiarize yourself with the complexities of SMS marketing while adhering to legal requirements and respecting customer preferences. Here are some common mistakes to avoid:

Cart Abandonment Messages

Shopping cart recovery texts are used to remind customers about items they left in their online shopping carts.

While effective for boosting sales, it’s important to ensure that these messages are only sent to users who have explicitly agreed to receive such communications.

Without proper consent, these reminders can be seen as intrusive and may lead to complaints or opt-outs.

Lack of Opt-Out Clarity

Every SMS message should include a quick and easy option for recipients to opt out of future communications even though customers have already opted in.

Failing to provide an easy opt-out method violates most compliance guidelines and also frustrates recipients, potentially leading to negative feedback and a damaged customer relationship.

Selling Age-Restricted Items

When sending SMS messages about products that have age restrictions (like alcohol or tobacco), it’s important to verify the recipients’ age before messaging.

You must implement a reliable age verification process at the point of opt-in to ensure that all communications are sent only to eligible individuals.

Failing to verify age can lead to legal issues and damage to your brand’s reputation if you inadvertently promote these products to minors.

Inadequate Consent Processes

Consent must be clear and unambiguous so recipients fully understand and actively agree to what they are signing up for. Other than ticking a generic checkbox, they should be informed about the types of marketing messages they will receive and how often.

How to Gather Consent for SMS Marketing

Effective SMS marketing starts with legally and ethically collecting consent from recipients. Below are detailed strategies to ensure that your process for gathering consent is both compliant and clear to your customers:

Use Clear and Understandable Language

When asking for consent, you must use language that is free from legal jargon or marketing fluff. Clearly specify what the recipient is signing up for, including the type of messages they will receive (e.g., promotions, updates) and how frequently they will be contacted.

Incorporate an Opt-In Mechanism

It’s essential to provide a clear opt-in mechanism, such as a checkbox on a sign-up form that is unchecked by default. This ensures that users actively choose to opt-in rather than being automatically enrolled. 

Prospects can also text a business to opt-in using words like “Join” or other keywords that they may have seen in an ad or on social media. When a customer sends a business a text it is clear that they are expecting a text response and therefore opting -in for text messaging.

 Prospects can also opt-in via a call center interaction, but they have to have agreed to opt-in based on a script read to them by the agent. The company must also have a means of tracking that opt-in method.

Implement a Double Opt-In Strategy

A double opt-in process sends a confirmation message after the initial sign-up, asking the user to verify their consent to receive SMS communications. This might involve replying to the SMS with a specific keyword or clicking a link to confirm their subscription.

An extra step helps to ensure that the consent is deliberate and can reduce the chances of misunderstanding or accidental sign-up.

Maintain Accurate Consent Records

Keep detailed records of when and how each consent was obtained, including the date, time, and the exact form of consent. These records are important for compliance, especially if your practices are ever questioned by regulatory authorities or in case of disputes.

Compliance Checklist for SMS Campaigns

Ensuring your SMS campaigns are compliant with regulations protects your business from legal risks and maintains the trust of your audience. Here’s a checklist to guide you through setting up a compliant SMS marketing campaign:

Know The Types of SMS Messages

SMS messages can generally be categorized into three types, each serving different purposes within a campaign:

Transactional messages provide necessary information related to a user’s action or account, such as order confirmations, shipping updates, or appointment reminders. 

These messages should only be sent to customers who have completed a transaction or have an ongoing relationship with your business.

Conversational messages are two-way communications initiated by either the customer or the business, such as customer support queries, booking confirmations, or feedback requests.

Explicit consent should be obtained for sending non-transactional conversational messages if the business initiates them.

Promotional texts are used to promote sales, special offers, or events. They are designed to engage customers and motivate them to take action. 

You must obtain clear opt-in consent specifically for promotional messaging, as these require explicit permission under most regulations.

Obtain Permission

You must make the consent request clear and detail what messages the recipient is signing up for and how often they will receive them.

Opt-in mechanisms can include actions like texting a specific keyword to a shortcode, checking a box on a website form, or signing up in person at events or sales points. 

You can also implement a double opt-in process, where the subscriber confirms their consent through a follow-up message.

Personalize Your Messages

Addressing the recipient by name or referencing past purchases can make the message feel more relevant and less intrusive.

You can also tailor your messages based on the recipient’s previous interactions or purchases with your brand. For example, if a customer bought a particular type of product, you could send them information about related products or upcoming sales on similar items.

Also, refrain from using language that could be perceived as overly promotional or spammy. Phrases like “Act Now!” or “Limited Time Only!” can come across as pushy and may lead to higher opt-out rates.

Schedule Frequency of Messages

The best time to send SMS messages will depend on your audience and the nature of your message. Well-timed messages can feel like helpful reminders or timely offers, making the customer more likely to engage positively with your content.

For instance, transactional messages should be sent immediately after the relevant customer action, while promotional messages might perform best during late mornings or early evenings.

How often you send SMS messages can also impact customer perception and engagement rates. When you over-message a customer, it can lead to irritation and high opt-out rates, so it’s essential to find a balance. 

Consider segmenting your audience based on their preferences or engagement levels. Some customers may appreciate frequent updates, while others might prefer less frequent communication. 

Tailoring your message frequency to these preferences can help maintain satisfaction across different segments of your audience.

Respect Privacy

Limit the amount of personal information you collect to what is necessary for your campaign. Over-collecting data can make customers uneasy and increase the risk of data breaches.

Be clear and upfront with your customers about what data you are collecting, why you are collecting it, and how it will be used. For example, you might ask for someone’s birthday, but make it clear that is so that you can let them know there is a birthday gift or promotion you want to offer. 

Include this information in your privacy policy and make sure it is easily accessible to your customers.

Provide Clear Opt-Out Instructions

Opt-out instructions should be prominently displayed in every SMS message. This means including a simple directive like “Reply STOP to unsubscribe” in a clear and easy-to-read format at the end of each message.

The opt-out process should be quick and require minimal effort from the recipient. Typically, a single keyword like STOP is sufficient. You should avoid complicated procedures that could discourage users from opting out if they wish.

Some advanced platforms like Textellent use AI to detect if the recipient has used non-standard language to opt-out, such as “ I had a bad experience with your company last time.” 

In that instance, the negative sentiment would be detected, and it would automatically put that customer on the “do no text” list and flag the message so that a staff member could review it. This ensures better protection for your brand. 

Stay Compliant in SMS Marketing with Textellent

Worried about keeping up with SMS compliance? Let Textellent take the stress away.

Textellent’s cutting-edge technology proactively manages compliance, automatically opting out recipients who may no longer wish to receive messages, ensuring you stay on the right side of regulations.

This platform also offers valuable insights into why customers may opt out, giving you the data you need to optimize your engagement strategies. It merges with your CRM system to automate and tailor your communications for marketing, sales, and customer service.

Learn more about how Textellent can make your SMS campaigns better and compliant! Sign up now for a free trial or request a demo consultation.

FAQs About SMS Compliance

Are there special considerations for promotional versus transactional SMS messages?

Promotional messages, which include sales and marketing communications, require explicit opt-in consent because they are not deemed essential to the service the customer has signed up for.

Transactional messages, such as appointment reminders or service alerts, do not require the same level of consent because they are considered part of the service the customer is using.

However, it’s important to ensure that transactional messages are not used as a vehicle for promotional content.

How can I manage opt-out requests effectively in my SMS marketing campaigns?

To manage opt-out requests effectively, include clear instructions in every SMS, such as replying “STOP” to unsubscribe. Automate the opt-out process using SMS platforms that instantly remove recipients from your list upon their request. Maintain accurate records of all opt-out requests, noting the date and time, to ensure compliance and protect your business.

How should I document SMS marketing consent?

Documenting SMS marketing consent should involve recording the date, time, method, and explicit details of the consent. If consent was given through a digital form, save a copy of the form and the submission confirmation.

If it was given via SMS, keep logs of the message exchange. It’s important to maintain these records in a secure, accessible format for as long as the consent is relevant and for a reasonable period.

How should businesses handle message and data rate disclosures in SMS marketing?

Businesses should clearly inform recipients that message and data rates may apply to the SMS they send – this is typically applicable in the case where the initial message was sent from a 5 or 6-digit number. Disclosure should be made at the time of opting in to ensure that customers are fully aware of potential costs associated with participating in SMS marketing campaigns.