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The video tutorial explains how to create an SMS campaign with high engagement, noting that over 90% of messages are read within three minutes. It highlights SMS as a cost-effective channel for customer engagement, using a makeup brand's example that aims to boost quarterly sales by offering a free gift with purchases. The key components for the campaign include defining the target user group, sending time, and message content. To set up SMS, users must integrate their preferred SMS provider, as CleverTap collaborates with top providers globally. To create the campaign, navigate to "Campaigns," select "Plus Campaign," and choose "SMS" under mobile channels, opting for a one-time campaign type for scheduling.