How to Measure Your SMS Marketing ROI 

With open rates as high as 98%, text marketing grabs attention fast. But high open rates don’t always mean strong results.

ROI (return on investment) helps you measure how much revenue you earn compared to what you spend. It shows you which campaigns are working, which ones need improvement, and how to grow your results over time.

Still, many businesses face challenges like sending messages at the wrong time, reaching the wrong audience, or using unclear calls to action.

That’s why tracking ROI matters. It helps you focus on what drives real results, and when you use that data, you can fine-tune your timing, message content, and audience targeting.

In this guide, we’ll explain how to calculate SMS marketing ROI, what factors impact it, and how to achieve stronger returns with every campaign.

Why SMS ROI Matters for Your Business

If you’re investing in sending SMS messages, you need to know what you’re getting back.

SMS ROI is the return you gain from the resources spent on SMS campaigns. In simple terms, it tells you how much value your messages generate after covering the campaign costs.

When you track ROI, you’re using actual data to decide what to repeat, what to fix, and what to stop. This makes every campaign more focused and helps you grow without wasting money.

Here are a few reasons why tracking your ROI is essential:

Tracking Campaign Effectiveness

Let’s say you launch a text marketing campaign to promote a weekend sale. You send out 2,000 texts and get 300 clicks. It may sound good, but how many sales actually happened?

ROI helps you connect those clicks to sales. It tells you if the campaign was worth the cost or if it needs changes.

This is useful when running multiple campaigns over time. You can compare them side by side. Which one brought in the most revenue? Which one had the lowest return?

Justifying Marketing Spend

Most small businesses don’t have unlimited marketing budgets. ROI helps you explain where the money went and why it was worth it. This is key if you need to report to a business partner or even just keep yourself accountable.

For example, if a campaign costs $150 and makes $1,200 in sales, you’ve got a clear reason to keep doing it. If it costs $150 and brings in only $100, it’s time to stop or adjust.

This makes ROI a useful tool for deciding where to invest next. Should you put more money into texts? Or move it to another channel? The numbers help you choose.

Identifying High-Performing Strategies

One of the biggest benefits of tracking ROI is finding out what works. Maybe short texts get better responses. Maybe people click more when there’s a time limit.

Over time, you’ll see patterns that you wouldn’t have noticed just by looking at open rates or clicks.

You might also see that one customer engagement segment responds better than others. Or that texts sent on Tuesday afternoons bring in more orders than those sent on Friday mornings.

When you spot a winning strategy, you can use it again in your next text campaign. That saves time, cuts waste, and leads to more returns.

How to Calculate ROI for SMS Marketing

If you’re putting money into text messaging campaigns, you should know what that investment brings back. The good news is, you only need the right numbers and a clear formula to understand your ROI.

SMS Marketing ROI Formula

ROI is calculated using the following formula:

(Revenue – Cost) ÷ Cost x 100 = ROI

This gives you the percentage return generated from a campaign. A positive result means the campaign earned more than it cost to run. A negative result indicates the return did not cover the expenses.

Example:

If you spent $300 on a campaign and generated $1,500 in revenue, your ROI would be:

($1,500 – $300) ÷ $300 x 100 = 400% ROI

In this case, you earned $4 for every $1 spent. It’s a strong return that suggests the campaign performed well.

What Counts as “Cost”?

Most businesses think the cost only includes what they paid to send SMS messages. That’s only part of it.

You should also count:

• Monthly fees for the platform you use
• SMS cost per message
• The time your team spent writing, designing, or testing the message
• Any tools used to track or segment your audience

These all play a role in the total pricing structure of a campaign. If you leave them out, your ROI numbers won’t reflect the full picture.

What Counts as “Revenue”?

This depends on what your campaign was trying to do. If it aimed to drive purchases, total sales from those texts go into the revenue column. 

If it focused on lead generation or appointments, you need to estimate how much those leads are worth based on your usual conversion rates.

Let’s say you offered a 15% off code in a text campaign, and it was used in 100 orders with an average order value of $60.

100 x $60 = $6,000 in revenue

That number goes into the ROI formula.

You need to make sure you’re tying results to one specific campaign. Using unique codes, tracking links, or campaign tags can help you separate traffic and sales so you’re not guessing.

Keep Each Campaign Separate

You shouldn’t combine results from multiple campaigns. If you lump the results together, you will likely lose clarity. ROI should always be measured one campaign at a time.

With Textellent, each campaign has its own reporting. You can see how much you spent, how many people responded, and calculate the revenue it brought in. That makes tracking ROI easier and more accurate.

Factors That Impact SMS Marketing ROI

Several factors influence how well your campaign performs. If your ROI is lower than expected, these areas are worth reviewing.

List Quality

Your text message marketing subscriber list is one of the most important pieces. A large list won’t help much if the people on it aren’t interested or active.

You have to focus on building a list of real contacts who want to hear from your business, such as people who opted in, respond from time to time, and show signs of interest.

Using a text marketing platform like Textellent makes list management easier. You can filter out inactive users, remove duplicates, and keep track of who’s most engaged. That impacts your campaign performance and keeps you from wasting money on inactive numbers.

Segmentation and Targeting

One message won’t work for everyone. That’s where a solid SMS marketing strategy helps.

When you send the same promotion to your full list, most of those contacts won’t engage. But if you group your list by buying habits, location, or customer type, you can send messages that feel more relevant. This increases the chance of getting clicks and conversions.

Textellent makes this step simple with SMS segmentation features built into every campaign. You can create groups based on past activity and target them with more focused messages, which leads to stronger results.

Message Frequency and Timing

Sending texts at the wrong time can damage your response rate. Sending too often can also lead to unsubscribes.

Finding the optimal time and balance is key. It helps to test different times and track which ones perform best.

With a platform like Textellent, you can automate delivery and see which hours or days give you better results. That way, you’re not guessing when to send.

Message Content and Clarity

Each message should have a single goal and a simple path to take the desired action. You should avoid adding too many offers or links in one message.

Instead, keep the structure clean: a short greeting, a reason to click or reply, and a direct call to action.

A strong CTA paired with a simple link often leads to better clicks and conversions. That small improvement in content can boost ROI.

Delivery and Click Performance

Even the best message can’t perform if it doesn’t reach people. If your delivery rate is low, many of your messages might be getting blocked or bouncing. Low click-through rate can also point to problems in how your message is written or who it’s going to.

What Is a Good ROI for SMS Marketing?

There’s no single number that defines a “good” ROI, but most businesses using texting in their SMS marketing journey aim for a return that’s at least three to five times what they spend.

So, for every dollar spent on a campaign, the goal is to bring back $3 to $5 in revenue.

In real numbers, this usually puts a positive ROI between 300% and 500%. Of course, this varies based on your business type, offer, and target audience.

E-commerce brands with time-sensitive offers might see higher ROI, while service-based businesses may see slower results but more valuable leads.

ROI is also tied to how clearly you track costs and revenue. If you’re only counting message fees and ignoring platform costs or time spent, your ROI number may look better than it really is.

On the other hand, if you count all campaign-related costs and still see returns above 200%, that’s a sign you’re on the right track.

It’s also useful to compare texting performance with other tools. Many businesses find that running text messaging campaigns drives more immediate action than email or social posts. This is often due to higher open and response rates, along with the direct nature of sending text messages.

Why SMS Often Outperforms Other Channels

When you compare SMS to other forms of marketing like email, paid ads, or social media, it often comes out ahead when the goal is fast, direct action.

There are a few reasons why targeted SMS marketing efforts tend to perform better, and it mostly comes down to visibility, timing, and simplicity.

Text messages don’t get skipped over like emails. Most people check them within minutes, and that immediate attention gives SMS a major edge. Open rates for texts often sit around 98%, compared to 20% or less for email marketing. 

Timing also plays a big role. Texts are short and to the point, which makes it easier for people to act quickly. You send a simple link or code, and people respond. This faster response can lead to a better conversion rate.

Finally, while ad platforms can quickly drain your budget with no guaranteed results, text marketing stays cost-effective yet powerful. When your marketing campaigns are designed well and aimed at the right group, a small spend on SMS can bring in far more than most ad clicks or email blasts.

That’s why many businesses use SMS not just as a backup channel, but as their primary one when they need fast results.

How Textellent Helps You Maximize SMS Marketing ROI

Getting solid results from your SMS campaigns depends not only on what you send but also on how you manage, track, and improve each step.

Textellent is built with ROI in mind to help businesses of all sizes plan smarter campaigns, track performance in real-time, and connect messaging to revenue.

Easy Campaign Setup and Automation

Manual campaigns take time and limit how much you can scale. Textellent lets you automate messages based on key actions like a first purchase, appointment reminder, or follow-up after service.

You can reach the customer base at the right moment without needing to manage every message manually. These automated flows help improve timing, reduce missed opportunities, and increase conversions.

Advanced Segmentation and Personalization

Not every customer needs the same message. Textellent gives you tools to segment your SMS subscriber list using fields like location, past activity, or purchase history. You can then build campaigns that speak directly to each group.

The more relevant your message, the higher the chance someone will take action. That leads to more clicks and sales, and a better return per dollar spent.

Real-Time Reporting and Tracking

Knowing your ROI starts with knowing your numbers. Textellent shows you open rates, clicks, replies, and delivery results for every campaign type. 

When you track these key metrics, you can see what messages perform best, what timing works, and which audiences are most engaged. It also helps you avoid waste by stopping campaigns that aren’t getting results.

Easy Integration with Existing Systems

Your texting tool shouldn’t work in isolation. Textellent connects with CRMs, ecommerce platforms, and booking systems to bring your data together. It gives you a full picture of what’s working across your business.

It’s easier to analyze data, personalize outreach, and generate leads from each campaign, not just clicks.

Built-In Compliance and List Management

ROI also depends on keeping your list healthy and avoiding issues. Textellent helps manage opt-ins, supports unsubscribe handling, and stays aligned with TCPA (Telephone Consumer Protection Act) guidelines.

It keeps your list clean and your delivery rate high, which are important for long-term performance.

Reach Your Audience and Track the Outcome With Textellent!

If your SMS strategy is costing more than it’s delivering, you’re not getting the full value of SMS. But Textellent helps you do more than just send messages.

You get a full ROI-driven platform that helps you build smart campaigns, reach the right audience, and track responses and conversions. Automated flows, audience segmentation, and real-time analytics work together to help you grow.

If you’re investing in SMS, make every message count. Start using Textellent to track, improve, and grow your ROI with confidence.

Sign up for a free trial or book a demo today to see how your next campaign can deliver measurable returns!

FAQs About SMS Marketing ROI

What is the average ROI for SMS marketing?

While results vary by different industries, the average return on SMS marketing campaigns ranges from 300% to 500%.

For every dollar spent, businesses often earn $3 to $5 back. With well-targeted campaigns and the right platform, some businesses report returns even higher. Success depends on message quality, timing, list health, and tracking to deliver optimal results.

What is the success rate of SMS marketing?

Success can be measured in different ways, but key indicators include click-through rate, open rate, and conversion rate. SMS open rates are typically around 98%, with click-through rates between 15-30%.

Compared to email marketing, SMS often performs better because of its speed and visibility, especially when campaigns are personalized and sent to potential customers who’ve opted in.

What is a good ROI for digital marketing?

Across all digital marketing channels, a good ROI is generally 5:1, wherein every $1 you spend, you get $5 back. SMS often outperforms this because it’s more direct and leads to quicker interactions.

To improve ROI, you need to focus on campaign tracking, message clarity, and timely delivery to maximize value from each dollar spent.

What is ROI in texting?

ROI in texting refers to the return you earn from your text messaging campaigns compared to what you spent to run them. It includes revenue from sales, lead generation, or booked appointments.