The SMS Profit Math Most B2B CEOs Miss

SMS marketing ROI for B2B services: a practical guide

This guide focuses on service-based B2B companies and shows how to measure, improve, and defend SMS ROI so you can decide whether this channel really deserves a place in your marketing mix.

What is SMS marketing ROI?

SMS marketing ROI is the profit you can clearly link to your text campaigns compared with all the SMS-related costs you pay.

If you spend $5,000 across platforms, messages, and strategy, and you generate $50,000 in profit from deals that SMS helped start or accelerate, your SMS marketing ROI is 900 percent. The idea is simple, but it gives you the one thing you actually care about: did this channel make money or not?

For B2B service-based companies, this matters even more than in consumer retail. You are not chasing thousands of low-value orders. You are chasing a smaller number of deals that can each be worth five or six figures and may take months to close. A single extra closed deal can swing ROI from “meh” to “this is printing cash”. Poor tracking, on the other hand, can make SMS look weak even when it is quietly moving deals across the line.

Industry benchmarks often show SMS open rates around 90-98 percent, with some studies reporting 98% open rates and 18-30% CTR, while email averages closer to 20 percent. Other surveys suggest that SMS can drive between 5 and 20+ dollars in revenue for every dollar spent, and some report between $21 and $41 for every $1 spent, depending on the sector and offer. Texts are also read very quickly - often within 90 seconds - which is powerful for time-sensitive demos, events, and offers. Your number will be different, and you still need to adjust for margins and overheads - but if you track it properly, it is rarely zero.

I find it useful to think about ROI on two levels. Campaign-level ROI asks, “Did this specific SMS sequence or promotion pay off?” This is ideal for quick tests and keep-or-kill decisions. Channel-level ROI asks, “Is SMS, as a whole, pulling its weight compared with email, paid search, LinkedIn ads, and outbound?” That view tells you where to move budget.

When I look at the data over a quarter, it is common to see one campaign that looks soft on paper while the SMS channel overall looks fantastic because it shortens sales cycles, boosts show-up rates for calls, and reduces no-shows for demos. That is why you want both views.

What does SMS marketing cost?

Before you get serious about SMS marketing ROI, you need a clear picture of all the money going out. Many CEOs hear “texts cost just a few cents” and mentally file SMS under “almost free”. Then the real invoices land.

Key parts of SMS marketing cost include:

1. Per-message fees

   Standard SMS in North America often runs between $0.01 and $0.05 per message, depending on volume and provider. MMS with images or rich media costs more, and international routes may carry higher rates.

2. Short codes, long codes, or sender IDs

   Shared or dedicated short codes have monthly fees. Branded sender IDs or registered numbers in some regions require set-up and registration costs as well.

3. Platform or software subscription

   Most SMS platforms charge a base fee plus usage. This can range from tens to thousands of dollars per month, based on volume and features such as automation, segmentation, and reporting.

4. List-building costs

   You pay to grow your list. That might include paid traffic to landing pages that collect SMS consent, event sponsorships and trade shows where you capture mobile numbers, and website development to add SMS sign-up forms and compliant consent language.

5. Creative and strategy time

   Even simple SMS campaigns need offer strategy that matches your funnel, copywriting, and the design and build of any linked landing pages, plus technical set-up and QA. Whether this is covered by internal salaries or external help, it is a real cost.

6. Incentives and discounts

   If you use gift cards, trial extensions, free audits, or discounts to drive action, that value belongs on the cost side too. Otherwise you overstate SMS campaign ROI.

You can also think about costs as fixed or variable, and as one-off or ongoing. Fixed, ongoing costs include the platform subscription, number or code rental, and any baseline retainer-level strategy work. Variable, volume-based costs include per-message fees, incentives that scale with responses, and extra hours for big pushes. One-off costs include the initial integration with your CRM, legal review of your template language, and any complex automation build-outs.

Here is a simple monthly view to make the math concrete.

Notice how the fixed parts do not grow at the same pace as your list. That is good news. But if you ignore creative and incentive costs, your SMS marketing ROI will look bigger than it really is - and that can backfire once a CFO starts asking questions.

How to calculate SMS marketing ROI

The basic formula to calculate SMS marketing ROI is:

ROI (%) = ((Profit attributable to SMS − Total SMS marketing costs) / Total SMS marketing costs) × 100

The key phrase there is “attributable to SMS”. That is the part that takes a little work.

I will walk through a simple B2B example.

Scenario: IT services firm selling managed support

SMS list: 5,000 prospects who have given permission
Campaign goal: book sales consultations
Average first-year profit per new client: $3,000

Campaign results

Messages sent: 5,000
Delivery rate: 96% → 4,800 delivered
Click-through rate: 6% → 288 clicks to booking page
Booking rate from clicks: 35% → 101 consultations booked
Close rate from consultation to client: 20% → 20 new clients

Revenue (profit) side

Profit per client in first year: $3,000
Total profit linked to this SMS campaign: 20 × $3,000 = $60,000

Cost side

Message fees: 5,000 × $0.02 = $100
Share of monthly SMS platform: $200
Strategy and copy (internal or external): $1,200
Incentive: 20 gift cards at $50 each for new clients = $1,000

Total SMS marketing costs = $100 + $200 + $1,200 + $1,000 = $2,500

ROI calculation

ROI = (($60,000 − $2,500) / $2,500) × 100
ROI = ($57,500 / $2,500) × 100
ROI = 23 × 100 = 2,300%

Looked at another way, every $1 invested in this SMS campaign produced $24 in profit. For a CEO, that is the only line that really matters.

In practice, I rely on four building blocks to make this kind of attribution work: UTM-tagged links from SMS to specific landing pages, analytics to track sessions, form fills, and calls from those pages, CRM data that connects those leads to closed-won deals and profit, and a simple way to pull SMS spend, including internal time where needed.

You can run this math per campaign, per quarter, and for the entire year. Many leaders like a quick campaign ROI for day-to-day decisions and a rolling channel ROI to decide how much budget SMS should hold next quarter.

Here is a mini template you can copy into a sheet:

Once your team has filled this in for a few campaigns, the conversation around budget tends to get much easier.

Key metrics to measure SMS marketing performance

ROI is the score on the board. The SMS marketing metrics underneath it tell you why that score looks good or bad.

Think of them as the diagnostic panel behind SMS marketing performance. If you only look at ROI, you know the result but not the cause.

Here are the core ones for B2B service companies:

1. Delivery rate

   This is the percentage of messages delivered out of total sent. Low delivery can signal poor data hygiene or compliance issues. If delivery improves, every other metric has more room to grow, so ROI rises without extra list-building cost.

2. List growth rate

   This tracks new subscribers minus unsubscribes, divided by total list size. Steady growth means you can scale revenue without rising acquisition cost per contact. If list growth stalls, channel-level ROI may flatten, even if campaigns perform well.

3. Click-through rate (CTR)

   CTR is clicks on your SMS link divided by delivered messages. Higher CTR means your message and timing are working, which usually leads to more leads at the same spend.

4. Conversion rate

   This is the percentage of people who complete your primary goal: request a quote, book a demo, start a trial, or sign a contract. You can measure conversions per click and per message. A lift here has a direct, strong effect on SMS campaign ROI without changing your message volume.

5. Revenue or profit per message

   This is revenue (or profit) attributed to SMS divided by delivered messages. It is great for comparing different campaigns or segments. If one segment produces $5 per message and another produces $0.50 at similar deal quality, the budget decision is obvious.

6. Cost per acquisition (CPA)

   CPA is total SMS costs divided by the number of new customers created. Compare this with your target CPA or with paid search and outbound. If SMS CPA is lower than other channels at similar deal quality, ROI is likely strong. If you track CAC and payback more formally, this CAC payback period explainer shows how to plug channels like SMS into that model.

7. Unsubscribe or opt-out rate

   This is people who leave the list divided by delivered messages. High unsubscribe rates signal fatigue or poor targeting, which lowers lifetime ROI from that list.

8. Customer lifetime value (CLV)

   CLV is the total profit a typical client brings over the full relationship with you. When CLV rises, your acceptable CPA from SMS can rise, yet ROI still looks healthy.

Get these numbers into a regular report, even if it is simple at first. Over a few months, patterns appear and point straight at where to improve.

Conversion rate from SMS campaigns

Conversion rate is the percentage of people who receive or click an SMS and then complete your main goal.

For B2B, that goal is rarely a direct purchase. More often it is a demo or consultation booked, a workshop seat reserved, a quote request submitted, or an event registration confirmed.

You can measure conversion in two ways: per click (conversions divided by clicks) and per delivered message (conversions divided by delivered SMS). For lead generation, the per-click view is better for understanding page and offer performance. The message-based version shows you the full funnel from send to result, which feeds straight into SMS campaign ROI.

In my experience, many B2B SMS campaigns see click-to-lead conversion in the range of 10 to 30 percent when targeting warm audiences, while simple broadcast campaigns to cold or semi-warm lists often sit at the low end of that range or below. Your numbers may be outside that band depending on your offer, audience, and pricing.

Here is the interesting part. Moving a conversion rate from 2 percent to 3 percent does not sound dramatic, but that is a 50 percent jump in leads and revenue at the exact same messaging cost. ROI follows.

There are several practical ways to lift conversion rate from SMS. Tighter audience selection helps by sending sales-focused SMS only to contacts who have shown intent, such as visiting your pricing page, opening recent emails, or attending a webinar. This reduces wasted sends and raises both CTR and conversions. Stronger offers for decision-makers matter as well: a generic “book a call” will often underperform compared with something like “15-minute roadmap to cut your cloud bill” or “quick audit of your sales pipeline”. When your message and offer talk directly to the pain and value a senior buyer cares about, response improves.

Message and landing page match is another lever. If your text promises a free security review, the landing page hero needs to say “Free security review” as well. Any mismatch adds friction and drops conversion. Finally, reducing friction in the booking flow - short forms, pre-filled fields, and direct calendar links - usually results in more bookings from the same traffic. The more taps and fields you remove, the more responses you see.

Keep testing this metric. It is one of the fastest levers for better SMS marketing ROI.

Customer lifetime value from SMS subscribers

Customer lifetime value is the total profit you expect from a client over the full span of your relationship, not just the first invoice.

For B2B services, this is huge. You may land a client with a $5,000 project, but over three years they might renew, expand scope, and buy new services until their total value is many times higher.

A simple CLV framework is:

CLV = Average revenue per client per period × Profit margin × Average number of periods

Example:

Average monthly revenue per managed services client: $3,000
Average profit margin: 40 percent → $1,200 profit per month
Average retention: 24 months

CLV = $1,200 × 24 = $28,800 profit per client

Now connect this to SMS marketing ROI.

If you only count the first month of revenue after an SMS campaign, the numbers can mislead you. Consider the same campaign read two different ways:

SMS spend: $3,000
New managed clients acquired: 8

Short-term view, first month only

Profit counted: 8 × $1,200 = $9,600
ROI = (($9,600 − $3,000) / $3,000) × 100 ≈ 220 percent

Looks decent, but nothing crazy.

Full CLV view

Profit counted: 8 × $28,800 = $230,400
ROI = (($230,400 − $3,000) / $3,000) × 100 ≈ 7,580 percent

Same campaign, two very different stories.

SMS can also help increase CLV itself by nurturing leads that were not ready on first touch until they become ready, cross-selling related services (for example, strategy plus implementation), keeping clients warm between renewals, and reducing churn through helpful reminders and updates.

Once you know your CLV, you can decide how much you are comfortable spending to gain one new SMS-sourced client and still keep SMS marketing ROI above your target.

How to improve SMS marketing ROI with data

Up to this point, I have focused on measuring. Now I want to look at how you actually move the numbers.

Here are six data-driven levers and how each one lifts ROI:

1. Segmentation: send smarter, not louder

   Do not treat your SMS list as one crowd. Create segments such as new leads, active clients, past clients, different industry verticals, deal size tiers, and stage in the sales funnel. When you send a specific message to a specific group, you usually see higher CTR, higher conversion, and lower unsubscribe rates. All three push SMS marketing ROI up without increasing total send volume.

2. Personalization beyond the first name

   Using a name is a start, but you can go further by mentioning the company or tool stack you know they use, referring to a recent webinar they joined or guide they downloaded, and matching the call to action to their stage, such as “finish your assessment” versus “book your first call”. SMS platforms that plug into your CRM or CDP make this easier. Stronger relevance leads to better engagement and higher revenue per message.

3. Send-time and frequency testing

   One of the fastest ways to damage ROI is to message people at the wrong time. For B2B, you may find late morning or early afternoon in the contact’s local time works better, weekdays beat weekends for sales-focused texts, and a gentle cadence of one to four SMS per month per person is enough for many audiences. Run simple A/B tests on send times and monitor CTR and unsubscribe rate. The goal is a rhythm where people are glad to hear from you, not reaching for the stop keyword.

4. Offer and call-to-action experiments

   Your call to action is where profit is either made or left on the table. Use your data to compare free audits versus paid workshops versus strategy calls, short direct CTAs (“Book 15 minutes”) versus softer ones (“See your numbers”), and single-step booking links versus two-step flows with a short quiz first. For example, a consulting firm might test “Reply YES for a free 30-minute audit” against “Grab a quick 15-minute call to cut your CRM costs”. If the second version converts 40 percent better from the same segment, your SMS marketing ROI rises with no extra media cost.

5. Automated flows instead of one-off blasts

   Use SMS automation for new lead welcome sequences that direct people to key content or quick calls, event and webinar reminders that increase attendance, trial expiry alerts that nudge people to convert, and renewal and contract review reminders. Automation lifts revenue per subscriber by adding timely touches that would be impossible for your team to send manually, while your fixed platform cost stays about the same.

6. Tight integration with CRM and analytics

   Connect your SMS platform to systems such as Salesforce, HubSpot, or Pipedrive, to your analytics stack, and to call tracking tools if phone calls are a key conversion. When you can see which SMS, sent to which contact, led to which deal and dollar amount, decisions stop being based on hunches. You spend more on what works and cut what does not, which is one of the cleanest ways to grow SMS marketing ROI over time. If your deals often close offline, this guide on measuring ROI when sales close offline can help you connect those dots.

SMS marketing ROI case studies and examples

Nothing makes the numbers feel real like simple SMS marketing case studies. Here are three short examples you can map to your own world.

1. B2B IT services firm boosting consultation bookings

Business type: managed IT services, selling recurring support contracts
Audience size: 4,000 prospects from webinars, events, and inbound leads
Goal: fill the sales team calendar with qualified consultations

Campaign

A two-touch SMS sequence to prospects who had engaged in the last 12 months: first, an invite to a “15-minute security gap review”, followed by a reminder 48 hours later for those who clicked but did not book.

Key numbers

Messages sent (two touches): 8,000
Delivery rate: 97% → 7,760 delivered
CTR: 11% → 854 clicks
Bookings: 32% of clicks → 273 consultations
Close rate: 18% → 49 new clients
Average first-year profit per client: $4,000

Revenue (profit) side

Total profit: 49 × $4,000 = $196,000

Cost side

Message fees at $0.018: 8,000 × $0.018 = $144
SMS platform for that month: $400
Internal marketing time plus external copy support: $2,000
Small “thank you” gift for new clients: 49 × $40 = $1,960

Total cost = $144 + $400 + $2,000 + $1,960 = $4,504

ROI

ROI = (($196,000 − $4,504) / $4,504) × 100 ≈ 4,252 percent

This firm also saw shorter sales cycles because prospects who booked by SMS tended to be warmer and better informed.

2. Online retail brand running a flash promotion

Business type: direct-to-consumer skincare brand selling online
Audience size: 25,000 SMS subscribers
Goal: drive a weekend spike in sales for a new product line

Campaign

One launch announcement SMS on Friday and a “last chance” reminder on Sunday.

Key numbers

Messages sent: 50,000
Delivery rate: 98% → 49,000 delivered
CTR: 15% → 7,350 clicks
Purchase rate from clicks: 8% → 588 orders
Average order value: $70
Profit margin: 50 percent → $35 profit per order

Revenue (profit) side

Profit from orders: 588 × $35 = $20,580

Cost side

Message fees at $0.014: 50,000 × $0.014 = $700
Platform share: $250
Creative time: $750
Discount cost (margin sacrificed per order): 588 × $10 = $5,880

Total cost = $700 + $250 + $750 + $5,880 = $7,580

ROI

ROI = (($20,580 − $7,580) / $7,580) × 100 ≈ 171 percent

On first look, this is not as dramatic as the IT services example, but the brand also gained hundreds of new repeat buyers. When those repeat purchases over the next 12 months are counted, channel-level SMS marketing ROI looks far stronger.

3. Accounting firm using SMS to fill a tax planning event

Business type: regional accounting firm targeting mid-market companies
Audience size: 2,000 financial leaders and business owners
Goal: drive attendance to a tax planning breakfast that feeds the pipeline

Campaign

One SMS invite with a registration link, plus two reminders: one the day before and one the morning of the event.

Key numbers

Total messages across invite and reminders: 6,000
Delivery rate: 96% → 5,760 delivered
Registration rate from clicks: 18% → 360 registrants
Attendance: 65% of registrants → 234 attendees
New annual clients from follow-up: 6
Average annual profit per new client: $10,000

Revenue (profit) side

Profit: 6 × $10,000 = $60,000

Cost side

Message fees at $0.02: 6,000 × $0.02 = $120
Event venue, food, and materials: $2,500
SMS and email creative time: $800

Total cost = $3,420

ROI

ROI = (($60,000 − $3,420) / $3,420) × 100 ≈ 1,654 percent

The firm later used SMS to send gentle reminders to those same contacts for quarterly check-ins, helping grow CLV as well.

Across these three cases, a few patterns show up. Narrow targeting beats broad blasts; all three campaigns focused on warm, relevant segments, not random lists. Clear next steps create revenue; each SMS pushed toward one specific action - book, buy, or register - because vague invites usually lead to vague results. Tracking to profit, not just clicks, changes decisions; the skincare brand’s ROI looks moderate if you only check weekend sales, yet strong when repeat orders and CLV are added, while the B2B firms show how one campaign can fuel months of revenue. Finally, SMS works at different points in the funnel: it can spark new conversations, rescue no-shows, and keep existing clients engaged, and all of that feeds long-term SMS marketing ROI.

Frequently asked questions about SMS marketing ROI

What is a good ROI for SMS marketing?
It depends on your margins and sales cycle, but many companies aim for at least 300 to 500 percent ROI on profit from direct-response SMS campaigns. For high-ticket B2B services with strong CLV, far higher numbers are common once full lifetime value is counted.

How long does it usually take to see ROI from SMS campaigns?
You can see early signs within days, especially for appointments and events. For longer sales cycles, expect one to three months before deals influenced by SMS show up in closed-won reports. That is why quarter-level reporting is so useful.

Is SMS marketing ROI usually higher than email or paid ads?
It can be, especially when you already have a high-quality list. SMS open and click rates tend to beat email, and per-message costs are low compared with many paid channels. That said, you still need strong offers, permission-based lists, and proper tracking to see clear gains.

How do I track offline outcomes like calls or in-person meetings back to SMS?
You can use unique tracking numbers in SMS that forward to your main line, ask new leads “How did you hear about us?” and log SMS as a source in your CRM, and use unique booking links in SMS so you can see which meetings came from which campaign. For a fuller framework across all your channels, this playbook on measuring ROI when sales close offline walks through how to tie revenue back to marketing.

How often should I text my list without hurting ROI?
For B2B audiences, one to four messages per month is a reasonable starting point, with extra touches for very time-sensitive items like event reminders. Watch unsubscribe and spam complaint rates; if they spike, pull back or adjust your content.

Does SMS marketing still work for B2B and higher-ticket services?
Yes, when it is used thoughtfully. SMS will not replace account-based outreach or complex deals, but it is a strong support channel for reminders, value adds, quick check-ins, and timely offers. Often it helps deals move faster and show rates improve, which boosts SMS marketing ROI even if message volume stays modest.

How big does my list need to be before SMS marketing is worth it?
You can see value with only a few hundred high-intent contacts if your deal size is large. For lower-ticket services or online retail, a few thousand subscribers usually makes the math more interesting. What matters most is list quality and clear tracking, not just raw size.

If you want to connect SMS performance to the rest of your go-to-market efforts, these guides on tracking leads in GA4 without a developer and on building ROI calculators and tools buyers actually use can help you extend the same discipline across channels.