How Birdmoss Prepared for Texas’s New SMS Law (Klaviyo + Shopify Case Study)

A step-by-step case study in compliance, subscriber trust, and smart Klaviyo setup

Introduction

In September 2025, the Texas Business and Commerce Code expanded compliance requirements to include marketing text messages. For Birdmoss—a brand that uses SMS to share sneak peeks, stories, and special offers with subscribers—this was no small hurdle.

Businesses essentially have three choices:

• Register with the State of Texas — pay a $200 annual fee and provide a $10,000 bond, certificate of deposit, or irrevocable letter of credit.
• Stop using SMS marketing altogether.
• Correctly identify Texas residents and segment them to ensure compliance while continuing to use SMS in other regions.

Why this matters: The law allows for civil penalties of up to $5,000 per violation (per message). For a small brand, even a handful of violations could be devastating. Compliance isn’t optional—it’s essential.

Birdmoss chose the third path: segmenting subscribers by residency and purchase history. This allowed the brand to maintain SMS as a channel while protecting itself legally and keeping trust with subscribers.

Here’s how we helped Birdmoss build a compliance-ready SMS program that protects the brand, maintains subscriber trust, and keeps communication flowing.

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The Challenge

The new law requires businesses sending marketing SMS to Texas residents to either register with the state or qualify for an exemption. On paper, that seems simple: identify Texans in your list.

But the reality is trickier when segmenting with existing Klaviyo data:

• Area codes aren’t reliable — area codes are portable and not tied to a geographical area like they used to be.
• Klaviyo’s geo-location isn’t accurate enough for compliance, since it’s based on IP addresses or inferred activity.

This matters because the stakes are high: the law allows civil penalties of up to $5,000 per violation (per message). Relying on incomplete or inaccurate data could expose a brand to significant risk.

Because of these gaps, Birdmoss couldn’t rely on available segmentation rules inside Klaviyo. To comply, the brand needed a direct, subscriber-provided record of residency.

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The Steps We Took

1) Research & Clarification

• Reviewed the Texas statute in detail, focusing on exemptions.
• Confirmed that “customer” means someone who has purchased—not just subscribed—so Birdmoss couldn’t rely on the “current or former customer” exemption for the entire SMS list.

2) Polling Existing Subscribers

• Sent a friendly email + SMS campaign asking ALL current SMS subscribers to confirm their residency.
• Added a participation incentive: a $5 storewide discount code (no minimum; valid on both regular products and subscription boxes).
• Explained clearly that subscribers without a recorded response would be removed from SMS to meet the new requirements.

3) Updating Signup Forms

• Regular Klaviyo Forms (embed, popup, flyout): added a required radio button (“Are you a Texas resident? Yes/No”) mapped to a profile property for segmentation.
• Back in Stock Forms: since Klaviyo’s SMS step on this form doesn’t support radio buttons—we removed the SMS option from the Back in Stock form until Klaviyo adds the radio button.

4) Creating a Texas Purchase Flow in Klaviyo

To keep SMS compliant while continuing to sync SMS subscribers from Shopify, we added a Klaviyo flow that automatically tags Texas residents who make a purchase.

1. Trigger: Placed Order (Shopify metric).
2. Profile filters: State / Region = Texas OR State / Region = TX.
3. Action: Profile property update → set Texas Resident to Yes and Purchased.

With this in place, any Texas customer who has purchased is flagged appropriately, and can remain in SMS segments. The screenshot below shows the flow setup in Klaviyo.

5) Terms of Service Update

We added a dedicated section explaining the Texas update, why the residency question is required, and how Birdmoss uses the information solely for compliance and segmentation. (Exact wording below.)

Texas Residents and SMS Marketing
Effective September 1, 2025, the Texas Business and Commerce Code expands certain registration and compliance requirements to include marketing text messages. As part of these regulations, businesses that send promotional SMS to Texas residents may be required to register with the Texas Secretary of State unless an exemption applies. To help ensure Birdmoss complies with these requirements, we ask SMS subscribers to indicate whether or not they are Texas residents when signing up for text messages. This information is used solely for compliance and segmentation purposes and does not affect the content or frequency of messages you may receive if you are located outside Texas.

6) SMS Segment for Campaigns

• Birdmoss uses the segment pictured below "SMS Texas Resident: No or Texas Resident + Purchased" for SMS campaigns to stay compliant.
• Birdmoss also observes Texas State Quiet Hours to stay compliant when sending SMS marketing messages:
  Monday–Saturday: Do not send before 9 a.m. or after 9 p.m. 
  Sundays: Do not send before 12 noon or after 9 p.m. 
  
• Segmentation now lets Birdmoss exclude Texas subscribers from SMS if registration isn’t pursued—or re-include them quickly if/when registration is completed.

7) SMS Filters for Flows

For Flows with SMS messages we added filters to the messages using the Texas Resident custom profile properties.

This ensures automated SMS in flows only go to eligible subscribers, keeping Birdmoss compliant in both campaigns and automations.

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The Result

• A compliance-ready SMS strategy that manages Texas subscribers transparently.
• Higher response rates via a simple $5 thank-you incentive.
• Policies, forms, flows, and segments updated to align with the law.
• New SMS subscribers synced from Shopify are tagged in a Klaviyo flow to add residency info—closing the compliance gap.
  
• Compliant SMS segment for campaigns and filtered SMS messages in flows
• Flexibility to adapt to future regulatory or platform changes.
• Trust preserved through clear, friendly communication.

Bonus: By polling subscribers directly, Birdmoss now has a reliable record of residency, avoiding the inaccuracies of relying on area codes or Klaviyo’s geo-location data.

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Key Takeaways for Other Shopify Brands

• Don’t rely on area codes or geo-location for compliance—ask subscribers directly.
• Communicate openly; transparency builds trust.
• Offer a small incentive to increase participation.
• Review forms and policies so compliance is covered at every entry point.

Need Help Navigating SMS Compliance?

This case study shows how a proactive approach can turn a compliance headache into a stronger, more trusted SMS program. If you’re a Shopify brand wondering how these changes affect you—or how to update your Klaviyo setup—I can help.

Work with me to make sure your SMS program is compliant, subscriber-friendly, and revenue-ready.

Note: This article is for educational purposes only and is not legal advice. Please consult qualified legal counsel regarding your specific situation.

What Shannon Said

“This is great. I am sooooo grateful for your expertise and also your timely work to get Birdmoss in compliance with a short turnaround time.”

Shannon is a member of Reliable Revenue where I coach Shopify store owners how to get predictable and reliable revenue with step-by-step, proven email marketing strategies.