For decades, SMS was the king of text-based customer communications. But today, there’s a new sheriff in town: WhatsApp. And it’s quickly becoming the preferred channel for businesses to connect with customers.

In this guide, we’ll take an in-depth look at how WhatsApp stacks up against traditional SMS marketing. WhatsApp requires an internet connection for sending multimedia messages and engaging in conversations, while SMS does not rely on internet access. Additionally, WhatsApp has a character limit of 4096 per message, allowing for richer content compared to SMS. We’ll dive into the pros and cons of each channel, explore advanced features, and help you choose the best fit for your business goals.

Whether you’re looking to supercharge sales, level up your support, or just meet modern customers where they live, this WhatsApp vs SMS breakdown will give you all the insights you need.

Business Communication Overview

Importance of choosing the right messaging platform for business

Effective business communication is crucial for building strong relationships with customers, driving sales, and staying ahead of the competition. With the rise of instant messaging apps, businesses have a plethora of options to choose from when it comes to communicating with their target audience.

However, selecting the right messaging platform can be a daunting task, especially when considering the pros and cons of each option. The right platform can significantly impact your communication strategy, enhancing customer engagement, streamlining operations, and ultimately contributing to your business’s success. Whether you opt for the rich multimedia capabilities of WhatsApp or the universal reach of SMS, making an informed choice is essential for effective business communication.

Brief history of WhatsApp and SMS

WhatsApp and SMS (Short Message Service) are two of the most widely used messaging platforms in the world. WhatsApp was launched in 2009 and has since become one of the most popular instant messaging apps, boasting over 2 billion active users worldwide. Its rise to prominence can be attributed to its user-friendly interface, robust features, and the ability to send multimedia messages.

On the other hand, SMS has been around since the 1980s and remains a staple in mobile communication, with over 5.1 billion mobile service users globally. SMS allows users to send and receive text messages of up to 160 characters on mobile phones. Despite its simplicity, SMS has stood the test of time due to its reliability and universal compatibility. Both platforms have evolved significantly, adapting to the changing needs of users and technological advancements.

WhatsApp vs SMS: The pros and cons of instant messaging apps

When it comes to connecting with customers through text, WhatsApp and SMS each have their own advantages and limitations. SMS messages can be delivered to any mobile phone, making them accessible to a wider audience irrespective of internet connectivity. Let’s break down the key pros and cons:

WhatsApp pros with WhatsApp Business API

• Richer multimedia support: WhatsApp allows you to send images, videos, audio files, PDFs and other media to make messaging more engaging, while SMS does not allow multimedia content without incurring higher costs.

• Real-time interactions: With features like live chat and flows, you can have real-time, back-and-forth conversations over WhatsApp rather than disjointed, one-off SMS blasts.

• Easy broadcast reach: WhatsApp broadcasts allow you to segment your audience and reach them wherever they are. They can also engage by responding directly.

• Advanced automation: From scheduled marketing campaigns to chatbots, WhatsApp offers more advanced automation and personalisation capabilities compared to SMS.

• Encryption and security: WhatsApp offers end-to-end encryption for messages, ensuring more secure communication.

• Voice and video calls: WhatsApp supports voice and video calls, providing greater flexibility in customer interactions.

WhatsApp cons

• Internet requirement: Customers need an internet/data connection to access WhatsApp, which could be an issue in low-connectivity areas.

• Channel opt-in: Just like most channels, recipients must opt in to receive messages from a business on WhatsApp.

• Multimedia limitations: While great for images and videos, WhatsApp has limitations on the size of each file.

• Higher costs: The WhatsApp Business API may have higher upfront costs, as businesses are required to work with an authorised WhatsApp Business solution provider to set up their account and integrate it with their existing systems.

SMS pros

• No internet is required: SMS works over traditional cellular networks and doesn’t require a data connection.

• Universal compatibility: SMS is compatible with nearly all mobile phones, making it a reliable method for reaching a vast audience. Any modern mobile device can receive SMS messages out of the box.

SMS cons

• Character limitations: Most SMS platforms restrict you to 160 characters, or multimedia messages (MMS) get costly.

• Less interactive: Real-time back-and-forth is near impossible over SMS.

• Costly for mass messaging: Depending on your SMS provider and message volume, costs can accumulate. For businesses sending frequent messages, SMS might not be the most budget-friendly option, as SMS messages can incur costs depending on the number of messages sent, while WhatsApp typically charges per conversation.

• Lower engagement: Without rich multimedia or interactivity, customers are less likely to fully consume SMS communications.

• Security vulnerability: SMS messages are not encrypted by default, which raises security concerns for sensitive information.

Notifications, sales, support and marketing

Notifications and alerts

WhatsApp: Perfect for time-sensitive updates like order confirmations, appointment reminders, or loyalty programme updates. The rich media capabilities can be used for eye-catching visuals and increased engagement. Businesses can easily create different WhatsApp templates, from marketing to utility and authentication templates.

SMS:  While suitable for short, critical text messages (e.g., delivery notifications, two-factor authentication codes), SMS lacks the visual appeal and engagement potential of WhatsApp.

Winner: WhatsApp

Sales and conversions 

WhatsApp: Create a more personal sales and customer experience with chatbots and live chats. Target specific customer segments with special offers, product launches, or exclusive discounts. WhatsApp’s interactive nature allows for quick inquiries and easy purchasing journeys.

SMS: They can be used for basic sales blasts or flash sales. However, the limited character count and lack of visuals make it less effective for showcasing products or creating a sense of urgency. Text messaging allows businesses to send mass messages and provide critical updates, achieving high open rates compared to emails.

Winner: WhatsApp

WhatsApp: Convenient for customers and teams because it offers real-time, two-way customer support through chatbots or live agents. Customers can easily send pictures or videos to explain issues, and support teams can use WhatsApp to collaborate, leading to faster resolution times and improved satisfaction.

SMS: Limited to one-way communication, making it unsuitable for in-depth customer support. Customers can’t send screenshots or videos or have back-and-forth conversations to troubleshoot issues.

Winner: WhatsApp

SMS marketing and promotions

WhatsApp: Build stronger brand relationships through engaging content like behind-the-scenes glimpses, polls, WhatsApp newsletters or loyalty programmes. WhatsApp messages are end-to-end encrypted, protecting against interception by scammers. Businesses can easily verify their WhatsApp accounts for authenticity to distinguish them from potential scammers. The WhatsApp Business API allows for targeted campaigns and advanced analytics for measuring success.

SMS: They can be used for basic brand awareness campaigns like contest announcements or product launches. However, its impersonal nature and limited space make it less effective for building long-term brand loyalty.

Winner: WhatsApp

Communication Strategy

Developing a communication strategy with WhatsApp

Developing a communication strategy with WhatsApp requires careful consideration of your business goals, target audience, and messaging needs. WhatsApp offers a range of features that can be leveraged to create an effective communication strategy.

The WhatsApp Business API allows for seamless integration with your existing systems, enabling automated responses, customer segmentation, and detailed analytics. A WhatsApp Business Account provides a professional presence on the platform, while the WhatsApp Business App offers tools for managing customer interactions on the go. To get started, identify your key objectives—whether it’s sending marketing messages, providing customer support, or driving sales.

Next, tailor your messaging to resonate with your audience, using the platform’s rich media capabilities to enhance engagement. By leveraging the full suite of WhatsApp’s features, you can create a dynamic and responsive communication strategy that meets your business needs.

Numbers don't lie

When it comes to measuring the impact of messaging channels like WhatsApp and SMS, the numbers speak for themselves.

Open and engagement rates

• WhatsApp has a 98% open rate.

• Just like WhatsApp, SMS also boasts a 98% open rate.

• Customers on WhatsApp show 70% higher engagement compared to SMS, with WhatsApp messages having a slightly higher open rate, estimated at 99%.

• Businesses have reported up to a 40% increase in engagement rates since switching to WhatsApp.

Message delivery 

• WhatsApp has a 99% delivery rate for messages.

• SMS has a 98% delivery rate for messages.

Conversion rates

• Businesses using WhatsApp have reported a 156% increase in conversion rates.

• SMS has a 45% conversion rate.

WhatsApp vs SMS: Who's your pick?

The decision between WhatsApp and SMS really depends on your business needs and audience. Want to reach customers anytime, anywhere, with high-converting broadcasts? WhatsApp is a clear winner. Need a fallback for low-connectivity areas? SMS provides a universal solution.

Many businesses use both channels together. Having a WhatsApp account allows businesses to utilize features such as automated responses and message sorting, making it a valuable tool for customer service and marketing. To get started with WhatsApp, contact Cue for a demo!

Frequently asked questions

Which is more cost-effective for business communication: WhatsApp or SMS?

Cost-effectiveness depends on your messaging volume and needs. SMS typically charges per message sent, which can add up with high volumes. WhatsApp Business API charges per conversation, which may be more economical for businesses with frequent customer interactions. For small businesses, the free WhatsApp Business App might be more cost-effective than SMS services.

Can I use both WhatsApp and SMS together in my communication strategy?

Yes, many businesses use both channels as complementary tools. You might use WhatsApp for rich, interactive customer service and marketing campaigns while keeping SMS for critical notifications that need to reach customers without internet access. This dual approach ensures maximum reach and engagement across different customer segments.

How secure is WhatsApp compared to SMS for sharing sensitive business information?

WhatsApp offers end-to-end encryption for all messages, making it significantly more secure than standard SMS, which is not encrypted by default. For businesses handling sensitive customer information, WhatsApp provides better protection against data breaches and unauthorized access. However, both should be used cautiously when sharing highly confidential information.

What are the automation capabilities of WhatsApp compared to SMS?

WhatsApp offers more sophisticated automation features through its Business API, including chatbots, flow builders, and interactive templates. These allow for personalized customer journeys and real-time engagement. SMS automation is typically limited to scheduled broadcasts and basic auto-replies. WhatsApp automation can significantly reduce response times and enhance customer experience through intelligent routing and conversational AI.