Promotional vs. transactional SMS – What is the difference?

Promotional SMS is used for marketing and sales, while transactional SMS is used for providing information. Learn more about the differences and how to leverage these two types of SMS for your business.

Senior Content Marketing Specialist

Dan Mekinec

Senior Content Marketing Specialist

The main difference between promotional and transactional SMS messages is their purpose. Promotional SMS is used with commercial intent, while transactional SMS messages are used to deliver important information. 

An example showing the difference between promotional and transactional SMS message

Here is a brief overview of these two types of SMS:

Promotional SMS

  • Purpose: Commercial (increasing sales, promoting products, or raising brand awareness).
  • Examples: Coupons, discounts, abandoned cart reminders, new product announcements, etc.
  • Requirements: In many countries, express written consent from recipients is required, with an opt-out option in each message. Special rules can apply in specific markets (like quiet hours or days).

Transactional SMS

  • Purpose: Informational (providing necessary information for customers to use a product or service).
  • Examples: Order confirmations, shipping and delivery updates, appointment reminders, and account-related notifications.
  • Requirements: Express written consent is required, which can be obtained when customers provide their mobile numbers (e.g., during checkout).

Now, let’s explore each type in more detail.

What is promotional SMS?

Promotional SMS refers to using SMS for marketing purposes, such as advertising products or services, announcing sales, sending special offers, or promoting events. You can easily recognize these messages by their clear call to action, like “Use code” or “Buy now.” 

Example of a personalized promotional SMS (abandoned cart reminder).

Example of a personalized promotional SMS (abandoned cart reminder).

Although SMS is limited to 160 characters of text, SMS marketing campaigns are quite popular among businesses. In fact, we’ve seen a 63% increase in promotional SMS traffic when comparing 2023 to 2022. Consistently high open and response rates are among the main benefits of SMS marketing, which makes it a very cost-efficient channel for promoting products and services. 


Increase in SMS traffic for marketing use cases in 2023 vs. 2022. Source: Messaging trends report.

Examples of promotional SMS

These are some of the most common ways businesses use promotional SMS:

Limited offers and deals
Sending coupons or discounts directly to customers’ phone numbers or notifying them of flash sales.

E.g., “Flash Sale Alert! Get 30% off all shoes this weekend only. Use code FLASH30 at checkout. Shop now!”

Personalized offers
Sending automated discounts on customers’ birthdays.

E.g., “Happy Birthday Jane! Enjoy a special 15% discount on any item of your choice. Use code BDAY15.

Abandoned cart reminders
Sending automated reminders to customers who abandon shopping carts during purchase.

E.g., “You left items in your cart. Complete your order now and get free shipping!”.

New product promotions
Notifying customers of new products to boost sales.

E.g., “Introducing our latest gadget—the SmartLife Tracker. Be the first to try out!”

These are just a few examples of using SMS to send marketing messages. You can always adapt your tactics to your audience and business needs for the best results.

Related customer story:

How to send promotional SMS

Here is a step-by-step guide on how to start sending promotional SMS messages:

1. Choose a reliable SMS service provider

Start by finding a reputable promotional SMS service provider. Look for scalability, high delivery rates, and compliance with regulations. Consider providers that offer APIs for seamless integration with your existing systems.

2. Check SMS regulations in your market

In many countries, sending promotional SMS to customers requires explicit consent (opt-in). These messages are often strictly regulated under SMS laws, such as the Telephone Consumer Protection Act (TCPA) in the US or GDPR in the EU. These laws dictate how promotional SMS messages should look and when they can be sent. They also regulate how businesses collect, store, and use customer phone numbers, ensuring privacy and consent are respected.

Before sending promotional texts, you must understand and comply with the SMS laws in your market. We always recommend consulting with your provider to get expert guidance. 

3. Obtain consent from customers

You need to ensure each recipient consents to receive promotional SMS from you. You can achieve this through opt-in forms, checkboxes during sign-ups, or clear disclosure of SMS marketing messages during transactions. You should also maintain a record of consent to comply with legal requirements.

4. Segment your audience

Divide your audience into relevant segments based on demographics, behavior, or preferences. Segmentation allows you to tailor messages for better engagement. For example, segment by location, interests, or purchase history.

5. Craft direct, engaging messages

Keep your promotional SMS concise and impactful. Aim for clarity and urgency. 

Include a clear call-to-action (CTA): What do you want recipients to do? Visit a website, redeem an offer, or participate in a sale?

Personalize the SMS by using the recipient’s name or other relevant details. Dynamic fields allow you to insert custom information into each message.

6. Test and optimize

A/B test different aspects of your SMS campaigns: content, timing, and CTAs. Monitor delivery, open, and conversion rates, then adjust your strategy accordingly.

What is transactional SMS?

Transactional SMS refers to automated text messages that don’t have a promotional or commercial intent. Instead, they are used to send important information to customers, such as account changes, upcoming appointments, shipping updates, etc.

People tend to trust SMS more than emails or other communication channels. This makes it a great way to reach your customers on time with the critical information they need to know.

Examples of transactional SMS

Here are some of the most common use cases for transactional SMS:

Order confirmation
Confirming that a customer order was received, e.g., in e-commerce.

E.g., “Thank you for your order! We’ve received it and are processing it now. Order ID: #12345.”

Delivery updates
Sending updates about a package’s estimated time of arrival.

E.g., “Your package is on its way! Estimated delivery: [Date/Time]. Track it here: [Tracking Link].”

Real examples of delivery updates sent from MrSpeedy, one of our customers:

Appointment reminders
Automated reminders of upcoming appointments, like a doctor’s appointment.

E.g., “Reminder: Your dentist appointment is tomorrow at 10:00 AM. See you there!”

Booking status updates
Confirming or canceling bookings or receiving automated messages from property owners.

E.g., “Booking Update: Your reservation is confirmed for [Dates]. Enjoy your stay!”

Note: Although some might categorize SMS 2FA as transactional, we consider it a slightly different use case that’s not just informational, as it involves a time-critical security aspect (e.g., accessing user accounts). 

Related customer story:

How to send transactional SMS

Here is a step-by-step guide on how to start sending transactional SMS messages:

1. Choose a reliable SMS provider

Find a reputable SMS service provider that specializes in transactional SMS messaging. Look for features like high delivery rates, scalability, and robust APIs.

2. Ensure compliance with SMS regulations

While regulations on transactional SMS aren’t as strict as those on promotional messages, users must still be informed that they will be notified via SMS. 

For example, you can include a clause explaining transactional communication during sign-up or account creation.

3. Segment your audience

Segment users based on their interactions with your business. For example, separate order-related messages from account-related ones.

4. Craft clear and concise messages

Transactional SMS should be straightforward and informative. It should include relevant details (e.g., order number, appointment time) and a clear purpose.

5. Automate the process

Set up triggers for transactional SMS in your messaging platform. For example:

  • Order confirmation after a successful purchase
  • Appointment reminders a day before the scheduled time
  • Password reset instructions upon user request

6. Test the flow

Ensure that the SMS flow works seamlessly. Test different scenarios (e.g., order confirmation, appointment rescheduling) to verify accuracy.

7. Monitor delivery and open rates

High delivery rates are crucial for transactional messages, so keep an eye on them, and optimize your flows and messages accordingly.

Key takeaways

Never send SMS messages to customers without first checking compliance laws in your target market.
Consent for transactional messages does not automatically imply consent for promotional text messages.
Always clearly identify your brand when sending promotional and transactional texts. Failing to do so risks damaging your brand credibility and may lead to customers reporting your number as spam.

To get the best results from your SMS programs, we recommend finding a proven SMS provider to help you meet compliance requirements and equip you with the right solutions. 

Please note: this content is provided for information purposes only and should not be relied on as legal or compliance advice.

Related solutions

Promotional SMS

Don’t let your hard work on marketing campaigns get lost in an email inbox. Offer discounts, special offers and loyalty rewards on a channel customers are sure to notice.

Transactional SMS

Integrate with our flexible SMS API, or explore no-code or low-code integration options, and ensure your customers never miss an update.

This blog was last updated in June 2024. Updates include a summary of the differences between promotional and transactional SMS, and general guidelines on how to start sending each message type.

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Jun 19th, 2024
7 min read