What is a Transactional SMS: Definition and Guide

What is a Transactional SMS: Definition and Guide

A transactional SMS is not something that users were never aware of; it’s just that they don’t know what it is. It’s not uncommon to get a message on the phone whenever a purchase is made or when money is withdrawn from the bank.

Transactional SMS, as these service messages are called, are sent by the company or online store to confirm the user or customer’s action.

It is an automated messaging service triggered by a specific action done by the customer regarding a product or service of the company. Most common examples of transactional SMS include delivery confirmation texts, password change, and bank balance updates.

These automated messages are prevalent because they are simple and easy to relay information to the customers in real-time. With such popularity among users, it won’t come as a surprise that 70 percent of these users preferred the service of automated messages on their phones, evidently so as they perform various functions such as:

  • They are used for notifying the customer regarding the account balance information that can include transactions and withdrawals using credit or debit.
  • They are used to confirm order placements of a product, subscription, or service from an organization, online store, or company.
  • They are used for confirming the purchase of tickets for flights, trains, or public transport as short messages can conveniently highlight the essential details required for the customer’s competence.
  • They are used for confirming the bills and receipts of any monetary purchase, refunds, or faulty transactions that may have occurred.
  • Organizations can be sent OTPs or One Time Passwords for account resetting or accessing an account from another device. OTPs are also secure enough to confirm bills or purchases through banks and payment sites.
  • They are used to confirm transactions either through debit or credit for a product or a subscription.
  • They are used to notify the customer of the details of shipping and delivery time for a product purchased from an online store. It keeps the customer up to date with only the relevant information.
  • Transactional messaging services can also help mass communication to the public or the government for emergencies and alerts. Banks and companies can also notify the customer regarding any suspicious or malicious activities regarding the customers’ accounts and monetary transactions.

Many organizations and services implement transactional messaging services due to their wide range of applications and customer engagement. It is the perfect and quick way to communicate any details with the customer.

A Guide On How These Automated Messages Work:

  • The customer usually uploads their phone numbers when signing up for an account or purchasing a product or service from an organization. The company stores this phone number as the primary source of contact of the customer during this purchase or registration.
  • Since the customer owns this number most of the time, the number acts as a recipient for quick messages and alerts.
  • Every transactional message is coded, which means the customer’s specific action triggers it. It can include bill payments, account resetting, or money withdrawals from an ATM.
  • The action triggers a response from the software whereby a short automated text is sent to the phone that the customer specifies.
  • The purpose of the transactional message is to notify the customer or confirm the action. It is up to the customers to either reply or does what is best according to the received SMS.

How Effective Are These Transactional Messages?

  • Very Prompt: These automated tests can be sent quickly in real-time irrespective of where the customer is located. Being automated through software, they can be sent out as soon as the customer triggers an action.
  • Highly Reliable: Studies have shown that users are more likely to open a transactional message on their phones, making this service reliable in addressing any information regarding the users. It makes them the most effective way to communicate with users.
  • Customer Engagement: These messaging services help build loyalty and trust with the customer. It shows that the company is making an effort to bring value and establish reliable communication with the users.
  • Any Time, Any Day: Customers can receive these messages anywhere in the world in real-time. A customer can receive information and alerts almost immediately as soon as an action is triggered.

A highly effective, transactional messaging service can be helpful for both businesses and non-commercial purposes. They act as a quick way of relaying information to bypass phone restrictions for emergencies and alerts. It is another reason that every company and organization should implement this service and reap positive results.

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