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SMS pricing is changing (but will only affect large-body messages)

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SMS pricing is changing (but will only affect large-body messages)

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Last year, before we debuted our SMS Messaging feature, we spent a while coming up with a pricing model that would make it worthwhile for OwnerRez to support and maintain a solid SMS platform across thousands of users while not asking users to pay an outrageous price.

SMS is an important communication tool for any modern vacation rental host, and predictably, hundreds of OwnerRez users immediately jumped on it.

Over the past year, we've been carefully watching and analyzing our SMS costs. If you didn't know already - telephony carriers charge apps (like OwnerRez) per individual message and call (they actually charge per message segment and call leg) so we carefully collect millions of data points so that we know what every communication is costing us.  As we've watched that SMS usage, we've been forced to reevaluate how our SMS pricing works.

Our existing pricing model is based on a flat fee ($15/month) that covers most users and is designed to give you a basic package you can operate out of without feeling nickle and dimed. As usage grows in size, there is a usage charge that kicks in. Inbound messages are always included for free, but outbound messages start to incur an add-on fee as usage increases. We felt like this would help us deal with the larger usage of big PMs while also creating a low barrier to entry.

That overall pricing structure is staying the same with one small exception - we are now counting outbound messages per segment.  The original flat fee of $15/month is staying the same.  The usage cost of 3 cents per outbound send above 200 is also staying the same, only per segment now instead of the whole message.

Before you read further, take a second to click on the following link which will explain what a message "segment" is. It's very important that you understand this:

SMS Common Questions - What is a Message "Segment"

Okay, you're back now which means you've read the above link, and you understand that an SMS message is made up of multiple "segments" based on the size of the body and any image you include. You understand that really large SMS messages can be as much as 10 segments in a single message body.

You will see the same prices and break-outs on your invoice, only the add-on usage charge will include the number of segments.

Why are we doing this?

Contrary to what you might first think, this is not a shameless attempt to jack up our revenue! If we wanted to do that, we would increase the overall price per segment, or include fewer outbound segments for free, or increase the flat fee.  We are doing this to address a very real problem.

Here is the crux of the problem.... There is a group of OwnerRez users that send large-body SMS messages to each and every guest and often several times per booking (before, during and after the stay). These messages are many paragraphs long, are 8-10 segments each in size, and these users typically send thousands of these messages per month. Our telephony carrier charges us hundreds of dollars for each of these users per month, so we've been losing a lot of money. We've been watching and tracking those losses for 6-8 months.

We had these two options:

1) Disallow SMS messages (and templates) to be more than 160 characters in size. In other words, force every message to one segment or less.

2) Or, somehow, charge those users more than everyone else

We didn't want to do #1 because a hard limit of 160 characters would restrict what you can do in OwnerRez with sending images, attachments or messages that are slightly longer at times. We did not want to remove functionality from a well-received flexible SMS system. So we went with #2.

Will my price increase?

Do you send large message bodies in your SMS messages to all of your guests? Do you spell out your house rules, lay out pre-arrival information and so on - all within an SMS message? If so, then yes your SMS pricing will probably increase.

There's no need to guess! Go to the SMS Communication History under the Tools menu. Open one of the SMS messages you send to guests (look for a template-based automated message you send to everyone) and look at the top. We now show the length and include a segment counter as well.

If the above example makes you chuckle, believe it or not this is actually pretty common. Because emails get lost or ignored, some of our users have converted all of their informational and instructional emails into SMS messages which leads to messages like the above example.  As you can see, the above example is 8 segments long in a single message.  200 outbound segments will run out quickly if this is what you are sending to guests on a regular basis.

How can I lower my SMS pricing and overall charges?

If you are sending large-body messages (like the above example) as automated triggers, consider re-writing those to be small helpful nudges that ask the user to check their email for the longer, more-complete information.  Or create a web page on your website with the information they need and point to that in your message.  Using your website is great because you can be a lot more creative in what you show, and it drives your guests to your website where they learn about your brand and operation.  In the future, they are more likely to remember you, and book with you directly, if they have visited your website.

Am I being forced to change how I send messages?

Short answer: no.  You can continue sending large-body messages to your guests, and many times throughout the booking, as long as you are fine with paying a higher rate every month.

However, we highly recommend that messages be short and concise in nature, pointing to emails or web pages where the guest can go to view instructions and information.  We have several "guest guidebook" integrated partners that offer third party apps where guests can view your information in a clean organized manner.  If you send large-body messages, not only will your costs go up significantly, but your deliverability rate will go down.  Some carriers will delay or block SMS messages if the sender sends a large amount of volume or if recipients begin to block the sender on their phone.

Government organizations and telephony carriers have come up with new standards to address SMS spam and ways of assigning reputation to your brand.  This is already in effect in various pilot programs and something OwnerRez is actively working on supporting.  It's called "Direct Brands" for A2P 10DLC messaging (application-to-person messaging using regular 10-digit phone numbers) and will be announced in OwnerRez in the near future.  You'll be able to create a "brand" for your phone number that will carry real reputation across the carrier networks (Verizon, ATT, etc) and be shown on the recipient's phone as a trusted sender.  You will have to maintain you reputation, and not send large amounts of unsolicited messages, or your deliverability rate will suffer.

When does the new pricing take effect?

For new users (ie. those that join OwnerRez from today forward), the new SMS pricing is already in effect right now. In fact, you can see that live on our pricing page and our Cost & Fees support docs.

For existing users, your SMS pricing will stay like it was until the end of 2021. On January 1, 2022, your SMS pricing will join new users and everyone will be billed per message segment equally.

5 Comments (add yours)

Nov 5, 2021 11:34 AM
MaryF says:

Thank you for the information on something I didn’t know about. Is it possible to add a report for sms messaging to get data on our sms segments per message template and messages per various periods of time? This might help us make better informed decisions on tailoring our messages to reduce costs vs benefit of larger messages.

Nov 5, 2021 3:03 PM
Paul W says:

Great question, Mary. We are actively working on adding better visibility and clarity on segments inside the app. Our segment counter will be more accurate and also provide tips on how to "clean" your messages to avoid any extra charges. Some reports would be nice too - great idea.

Nov 6, 2021 12:22 PM
Susan P says:

The sms messages i receive now go to my computer or phone email, not to text messages on my phone, which is the best way for me to receive them. Can the sms messages i receive go to my text messages on my phone and not to my mail?
Please advise.

Nov 8, 2021 9:37 AM
Paul W says:

Can the sms messages i receive go to my text messages on my phone and not to my mail?

We are looking into ways of supporting this, but that requires push notifications which means we need to build a native app or messenger service for phones. It's something we've looked into a few times, and are working on supporting but only in conceptual/design phase at the moment.

Nov 9, 2021 3:34 PM
Chris L says:

Just FYI, this is probably the single biggest thing preventing me from signing up for the SMS feature. Just sayin'. ;)

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