Dedicated Short Code vs. Shared Short Code

Dedicated and Shared Short CodeClients ask me all the time: What’s better for their mobile strategy, using a shared short code or a dedicated short code? Each has its own set of pros and cons. In this post I will set the record straight.

Shared Short Code

PROS

1. Time to market: Sharing a mobile marketing company’s short code is the fastest way to get into the mobile space. For instance, clients using the mobileStorm 4.0 platform can create a keyword like ”SHOP” and within 10 seconds, that keyword is live and can receive texts from any carrier in the United States. Becoming a mobile marketer takes seconds, not months. Your time to market with a shared short code is extraordinary.

2. Cost: Short codes are expensive; it’s not like buying a $7.99-per-month domain from Godaddy. If you are sharing a code, typically there are very little additional costs involved other than paying for your messages going out.

CONS

1. Fair user experience: Because you are sharing your code, the user experience for your subscribers might be more tedious than if you had your own dedicated code. For example, on a shared short code everything is done with keywords. If you are asking someone to vote using A, B, and C and your keyword is FOOTBALL, you would need to get your audience to reply ”FOOTBALL A,” ”FOOTBALL B,” or ”FOOTBALL C.” This is so the system knows which keyword the voter is subscribing to.

2. Brand confusion: There isn’t much brand value out of using a shared short code. In some cases there is a very good chance someone else in your industry is using the same code you are, possibly even competitors. When the subscriber receives a text message, it comes from the five- or six-digit short code. If that subscriber is signed up to two different companies using the same code, he or she won’t know right off the bat who sent the message, until they have had a chance to read the body of the message. There is always the possibility that they want your texts, but not those from the other company. They could get upset and reply ”STOP,” and not realize they just removed themselves from your database.

3. Additional costs: Typically mobile marketing service providers will charge for a few extras if you are using a shared code. In some cases you have to lease keywords, and the price depends upon if it is a common keyword like SHOP or an uncommon keyword like SHOP1. The mobile service provider wants to make sure you don’t get a bunch of keywords and not use them.

Outcome: Shared short codes are wonderful for the small business with the small budget or for the enterprise that wants to test the waters. These businesses can get into the market quickly, and for not a lot of money. However, if you a well-known brand in your space or you have a little extra coin, you definitely want to consider a dedicated code.

Dedicated short code

PROS

1. Brand-friendly: It is extremely important for any business with a well-known brand to have its own short code. The subscriber needs to be able to recognize right away who is sending them a text message. You can even lease a vanity code that spells something, such as 73775 (Pepsi), or that is easy to remember, like 95959 (Palms Hotel in Las Vegas).

2. Portable: If you lease your own code, you can take it with you no matter where you go. You can switch your aggregator or mobile service provider and not worry about having to reintroduce your subscriber base to a whole new code. The brand confusion that happens after switching aggregators or service providers can be avoided by having your own code.

3. Better user experience: As I pointed out above, because you are not sharing your code with anyone, you don’t necessarily need to have a keyword sent before your action word. You can just have someone text in the keyword directly.

CONS

1. Costly: There are a few fees associated with have your own dedicated short code. First you need to choose whether you want a random or vanity code. You would apply for your code at www.usshortcodes.com and it would cost $1,500 or $3,000 per quarter depending on the type of code you choose. On top of that, most mobile service providers charge a monthly fee to host and maintain the code on a monthly basis. Also, setting up a short code is a lot of work and usually takes up to 10 weeks to get approved. There is usually a one-time set-up fee for someone to help you apply for the code and see it through testing all the way to certification.

2. Time to set up: This is one of the biggest bummers in mobile. They say it takes six to eight weeks to approve a short code, but I have seen it take as long as 12. If you are trying to get a code approved for premium SMS and binary content, it can really take a while. You would think there would be more of a turnkey process getting codes up and running, considering these codes are making everyone money. This is something the industry needs to figure out. There have been talks about selling pre-approved short codes to companies who qualify. If this happens, sign me up!

Outcome: There is no doubt that if you are a premium brand, you need your own dedicated short code. However, be prepared to pay and don’t expect to jump right in. I always suggest to my clients to use our shared short code while they are getting their dedicated ones approved. This allows them to get into the market right away so they can test some things out before their dedicated code is live.

”Short code” is just one of many phrases that might rattle the SMS marketing beginner. To learn more about numerous other SMS terms, read mobileStorm’s new white paper, SMS Primer, available for download here.

Jared Reitzin
Founder and CEO, mobileStorm
Small Business Information

 

4 Responses

  1. Marc Burgess says:

    Thanks so much for the article.

  2. Matt says:

    I understand that the requirement of short codes in the US is due to the spamming of phones. I feel that the carriers took advantage of the situation and forced this solution since it makes good money sense to them, and closes competition out in a very indirect way. Why not just register our long codes for a small fee if we want to use them for commerce, then have them regulated for an example of a much simpler solution.
    I have a small business that has a wonderful app over SMS, but we simply cannot implement it because of the short code costs. We should fight to get rid of the short code requirements in the US, or at least regulate the pricing, but in the meantime I am hoping that the solution Mobilestorm offers can help us.
    -Matt

  3. The cost of short codes really do create a barrier for the SMB. You should download and read about this in more detail in our new whitepaper: http://mobilestorm.com/resources/digital-mark

    We can definitely get you in the market with a shared code. We have a new one that is not yet being used that much.

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