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Our SMSPortal story

posted February 5, 2018
empire Our SMSPortal story

When nightclub owners asked Charles Stretch and James Pearce to help them keep in touch with patrons, the pair did not think it would lead to their running a short message service (SMS) marketing business that would generate annual turnover of R300m in little more than a decade.

Back then they were Port Elizabeth students who had Blueworld, a youth site, which was later sold to Naspers for an undisclosed sum in 2008. Nightclubs were happy to have youngsters use the site to post pictures of themselves at the clubs but also wanted a way to communicate with them. After some head-scratching, Stretch and Pearce came up with a bulk SMS product that allowed clubs to send out personalised messages to patrons about upcoming events.

It worked so well they thought it would be a good marketing vehicle for other businesses, and they created SMSPortal in 2002.

At the time, persuading businesses to see a text messaging service as a marketing tool was not easy. “The guys were sceptical,” Stretch admits. It took several years to win over large companies like Pick n Pay and Anglo American but once they signed up, they soon realised they were able to communicate with people who did not have a fixed postal address or landline.

It also gave them a means to aim promotions at specific customers in a more cost-effective way. Previously, it was unclear if print and broadcast efforts were reaching their target audience. Another advantage is that it gives customers the option to provide companies with direct feedback on their marketing efforts. Stretch points out that though there are benefits to marketing through text messaging, it must be done with care because customers can easily get annoyed if they receive messages they don’t want.

Stretch says the group is also careful to stay on the right side of the law. The soon-to-be-promulgated Protection of Personal Information Bill will make it illegal for service providers to resell user data. The Consumer Protection Act also gives consumers more rights when it comes to protecting them from a poor deal.

Besides obeying consumer protection legislation, there is also the threat of change in technology and the possibility of rival formats like WhatsApp and BBM replacing SMS as the preferred means of text communication. Stretch, however, is confident these won’t replace SMS marketing soon. “There must be at least another 10 years left in it.”

Besides its core market in SA, the business is beginning to gain traction abroad. Stretch says they have signed up customers in Ireland, the UK, Australia, Namibia and Nigeria and about 15% of profit now comes from international markets.

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