Can SaaS Afford to Leave SMS on the Sidelines?

The first SMS was sent in December 1992. In technology terms, that is several lifetimes ago — long enough to have watched pagers, fax machines, and PDAs come and go. So for SaaS companies competing in a crowded market, against a mobile landscape that keeps reshaping itself, a fair question is whether plain text messaging still earns its place. The short answer: yes, and arguably more than ever. Here is why SMS deserves a seat at the table in your SaaS communication stack.

A quick read on the messaging landscape

“Conversational commerce” — brands talking to customers inside messaging apps like Messenger and WhatsApp — moved from buzzword to reality. Messaging platforms now host large numbers of automated assistants, and AI agents have grown steadily more capable at handling real customer conversations.

The appeal is easy to understand. Mobile messaging apps reach billions of people, which makes them attractive ground for businesses. But there is a catch: these channels were built for talking to family and friends, so the kind of brand relationship a customer will tolerate there is narrow.

For an AI agent to help a brand rather than annoy its customers, it has to stay discreet. The right uses are quick customer-service answers and clearly requested information — not pushing marketing messages into a private chat thread. Dropping a traditional broadcast campaign into someone’s Messenger or WhatsApp, however polished the AI agent driving it, reads as intrusive.

The shift from P2P to A2P

As personal messaging apps cautiously opened up to businesses, SMS made the same move. It has been steadily ceding its original role as a person-to-person (P2P) channel and becoming an application-to-person (A2P) one — the messages your software sends to your users automatically.

The numbers backed this up early. The A2P share of SMS traffic nearly doubled in the first half of the decade, climbing from roughly 12% to over 22%, and analysts projected A2P volumes in the trillions of messages and a market worth tens of billions of dollars. Retail, finance, transport, healthcare, and logistics led the way, leaning on SMS for order confirmations, transaction verification, delivery tracking, appointment reminders, and results notifications.

Critically, consumers welcomed it. Surveys at the time found that a large majority of people were already communicating with businesses by SMS — more than were doing so via chat apps — and a substantial share said they would rather receive product details and updates by text than through other channels. Timely, relevant SMS from a business is not just tolerated; many people prefer it.

And what about push notifications?

Push notifications sit awkwardly in this picture. Industry research flagged a clear case of “push fatigue”: more smartphone users were declining notifications, and breaking through the noise had become harder for any app that was not already among the handful of dominant ones.

The takeaway was blunt — people were downloading fewer apps, tucking the ones they had into folders, and granting notification permission less often. Push did not die, but it lost much of its reach. If a customer never installs your app, or never enables notifications, push simply cannot deliver the message.

So what can SMS actually do for SaaS?

The way businesses reach customers on mobile has shifted on every front: messaging apps now make room for restrained AI agents, push has lost some of its punch, and SMS has settled into its role as the default A2P channel. At the same time, a tightening SaaS market has pushed many companies toward focused, vertical solutions. SMS — with its renewed A2P purpose — is well placed to help SaaS companies, new and established alike, communicate better with their users.

SMS for retention and customer service

SMS is especially well received for customer engagement and support. Consumer studies have repeatedly found that people see text as a faster, more convenient, and less frustrating way to reach a support team than the alternatives — and that SMS remains, by a wide margin, a preferred way to stay in contact with a brand. A meaningful share of users even say they would rather get loyalty and account messages by text.

That maps cleanly onto SaaS, particularly when the goal is reducing churn or delivering timely support. Depending on your trial length, onboarding, and renewal cycle, reducing churn with SMS can take several forms:

• Automated reminders so new customers don’t miss a kickoff or training session.
• Outreach triggered by warning signs — a visit to a downgrade page, or an account that has gone quiet.
• A well-timed nudge during a critical renewal window.
• A quick, helpful follow-up after someone visits a key FAQ or help page.

For moments like these — not worth a phone call, but too time-sensitive for email — SMS is an excellent fit. Text messages carry an open rate around 98%, with most read within minutes of arriving, while emails can sit unopened for days.

None of this means email and push have no role; in a multi-channel strategy they clearly do. The point is that SMS provides an immediate, hard-to-miss notification that lands better in certain situations. And because texting is asynchronous, a customer can read, think, and reply on their own schedule — something many people resent being forced to do on a live phone call. As for messaging apps, sending these kinds of operational nudges into someone’s Messenger or WhatsApp would, in most cases, feel like an intrusion.

Offering SMS inside your product

Retention is one use; building text messaging directly into your software is another. The same industries already busy with A2P messaging — retail, finance, transport, healthcare, and logistics — are the clearest candidates. Banking, finance, and retail have shown especially strong adoption, with authentication a major driver: confirming a password or transaction by text is now a routine expectation, and these sectors account for a large slice of A2P SMS growth.

SaaS providers serving these verticals have a real reason to treat SMS as a capability they offer their own customers, given how readily users in those industries communicate with businesses by message. In a maturing market for vertical solutions, native SMS can also be a genuine differentiator.

Key takeaways

The mobile landscape has made more room for A2P communication over SMS — a shift consumers are both driving and embracing. That opens two distinct opportunities for SaaS companies: using SMS to communicate better with their own customers, and building SMS directly into the product they sell. The verticals with the most to gain are the ones already seeing high A2P activity — retail, finance, transport, healthcare, and logistics. Wherever you sit, SMS is not a relic. It is one of the most reliable ways to reach a person on the device they never put down.

Callr makes that practical: a single REST API and webhooks for SMS and voice, running on owned EU carrier infrastructure with EU data residency by default — so you can add messaging to your product without stitching together a stack you don’t control.