ANALYSIS:
The battle for our attention has once again shifted to a new technological plane within the mobile space. The industry now is starting to turn its attention away from apps and instead focusing on a new interface to drive “conversational commerce,” a concept first named by social designer Chris Messina. It's centered around “delivering convenience, personalization, and decision support while people are on the go, with only partial attention to spare,” Messina wrote.
Already there are quite a few services lined up to capitalize on this opportunity, including Path's Talk, Kik, Telegram, Skype, WeChat, and Line. However, nobody appeared to be a market leader - at least until Facebook entered the scene.
At this year's F8 developer conference, the social networking company announced it was investing more into the messaging platform it launched in 2014. This means we'll start to see more businesses using Facebook Messenger to communicate with their customers and the introduction of bots to the platform. So with all of the fanfare heaped on the company this week, has Facebook's entry resulted in a significant impact on this conversational commerce industry?
“It's a once-in-a-decade paradigm shift,” said Beerud Sheth, CEO of the bot development firm Gupshup, when asked about the technological trend towards engagement in messaging. He believes it could be as significant as when Apple cofounder Steve Jobs introduced the world to the App Store. Mike Roberts, Kik's head of messaging and bot experience, described it this way: Messaging is the new browser and bots are the websites.
Forrester analyst Julie Ask believes that bots will evolve into a mechanism that helps us get stuff done, both on our smart device and via virtual agents like the Amazon Echo. Mobile will move from being a collection of apps and web experiences into “the next stage driven by platform experiences” with incumbent assistants Siri, Cortana, and Google Now already having a leg up. “Brands must embrace these emerging opportunities, as they own too few of their own mobile moments. Bots, and the chat platforms they run on, provide an amazing opportunity for brands to deliver contextual experiences on borrowed mobile moments,” she explained.
Brand chatting: Human or AI?
Many companies, including Facebook, are seeing messaging apps as the new frontier, something that they can build on top of. And if it doesn't involve interacting with a human agent, then it's all about bots, software products that have recently seen a renaissance.
Messaging doesn't have to be an either/or scenario, according to Sonar, a service brands use to participate in the conversational commerce space across multiple apps. Cofounder Neeharika Bhartiya told VentureBeat that bots have to be “laced with people,” requiring human intelligence to teach bots the right messaging to send to customers based on previous responses. Matthew Berman, another Sonar cofounder, believes that bots can be the start of a personalized interaction with a company, but when it comes to more complex queries, a human agent will need to take over.
Above: Screenshots of the experience businesses have on Sonar.
“The beginning part doesn't have to be like an IVR (Interactive voice response),” Berman remarked, referencing the computer system traditional call centers use where humans navigate using voice and keypad entries. “Sonar can make it intelligent that you display the appropriate response so it doesn't look like you're talking to a machine.”
While conversational commerce is a new way for brands to engage their customers, it's probably not going to be a major revenue stream for a while. Bhartiya said that the opportunity now lies in marketing services and motivating customers to take action, rather than sponsored posts and making sales right away. It's about building a great customer experience.
Berman emphasized that when diving into this space, brands should be careful about how they act. He advises avoiding an oversaturation of sponsored conversations, and also figuring out how to message the customers appropriately. “How do you be personable, colloquial, and make your customers think they're chatting with a friend, not a faceless corporation?” he asks.
“Businesses today don't get to choose where their customers are. Businesses need to be wherever their customers want them,” said Jeff Lawson, the CEO of Twilio, a cloud communication platform that recently integrated its API into Facebook Messenger.
The role of bots
While messaging apps aren't new, much of the discussion has centered around bots. But what role does this software play in the conversational commerce space?
To Phil Libin, a partner at General Catalyst, it's the new application layer: “It's a product that you interact with without a fixed user interface where you have to push this button, swipe over here, and you don't have to learn how to use it. You're just interacting with it conversationally.” His vision about the space is in line with Sheth's in that bots will cause an upheaval in how we interact with technology - we're going to turn from applications towards bots.
“A bot is a metaphor,” Sheth said. “What's truly significant about bots is the interface to the user is through a messaging app. On a small screen (like your phone), you're opening up a messaging app 100 times a day already, something that's not being done with any other app. It's convenient and successful.”
There are countless examples of such bots providing services across multiple industries, including commerce, travel and hospitality, and even productivity. While more will likely be a part of messaging apps, companies like Assist have sprouted up to help build the next big bot.
You may be familiar with Assist: It's a chatbot that can be accessed via SMS or Facebook Messenger that helps you with travel and shopping. But the real company is behind-the-scenes in that it's akin to the plumbing for the API, commerce, and preference systems.
Shane Mac, Assist's cofounder and CEO, said that since everyone is already hanging out in messenger apps, bots are being leveraged to enable businesses to reach them. He believes that app fatigue is real - people are tired of downloading apps and then rarely returning to them. “You can do commerce on a platform where people spend their time,” he said. “It's the Holy Grail.”
Bots have been around for quite some time. In fact, they existed years ago on AOL's Instant Messaging (AIM) and MSN Messenger in the early 2000s - remember SmarterChild?
“Think about what you do with any website or app and there will be a bot for that,” Sheth said. He also believes that 80 percent of our life behavior will be managed by bots.
And while every service is touting bot support, no one is actually emerging as a winner yet. Ryan Block, cofounder of bot startup Begin, thinks it'll take some time before a market leader appears - but that it could be Facebook. “Bots are the next natural evolution of human-computer interaction,” he said.
Judging Facebook's impact
“Facebook's potential impact on the bot space could be enormous,” Block told us. “I hope they take a big, healthy rip at it, because there just isn't a ton of consumer interest yet. No one else is playing at their scale right now besides Apple and Google - but that's OK, because in an abstract way, bots look a lot more like the web than like apps, with many possible paths into bot interactions from across various networks.”
All of the people we spoke with expressed optimism about Facebook's entry into the space, saying that it validates the market and adds legitimacy. “It aids in awareness,” Sheth remarked. “Facebook is such a prominent company that the media, developer, and brand interest is huge. It can impact a lot of consumers.”
“The entrepreneurial developer community is looking for a new opportunity to meet people where they are on mobile platforms with minimal acquisition costs,” Messina said. “Facebook's opening of their messenger API last year gives developers license to start experimenting on the platform, and work to define key behaviors between brands and consumers.”
At F8, Facebook CEO Mark Zuckerberg revealed that the combination of Messenger and WhatsApp processes 60 billion messages daily, compared to 20 billion via SMS. So what's the next logical step for these services beyond chatting with friends? Businesses. And Facebook wants to lead that way.
For the most part, messenger apps have the same mission: Be a communication service. And while Facebook Messenger falls into this category, it's banking on its platform to transform how we interact with one another outside of email and phone calls with businesses. It's not the first to go down this road, as WeChat has been doing this for a while and now reportedly counts 10 million business accounts on its service.
Facebook's entry into the space is significant in that it exposes people around the world to chatbots and artificial intelligence on a scale that other platforms can't. It also taps into a behavior that those outside of the U.S. are already accustomed to: not using web-based services. Sheth explained that such users tend to only be exposed to what's on their mobile device.
Right now, Facebook Messenger only has a few bots on it, including 1-800 FLOWERS, CNN, Shop Spring, and the weather app Poncho. It has also released a framework from which developers can build their own bots and submit it to Facebook for approval. Mac thinks that the careful curation is needed in order to meet the end user's expectations - if an app gets through that deliberately spams people, then it'll corrupt the impression and push them away from bots.
“You really have to work at it,” Messina noted. “Slack's @Slackbot is a great example that clearly was carefully crafted. It sets the tone for entire app's experience. While content strategy grew in relevance on the web and social media, this ratchets things up to a whole new level. Now your content won't just be static - it needs to be intuitive and improvisational. To achieve that, you need folks with literary and artistic skills.”
The opening up of messenger apps like Telegram and Facebook Messenger gives brands a way to really connect with users. It's a consolidation of sorts: People don't like making phone calls, and emailing a company doesn't seem to be personal anymore - Uber recently shifted its customer support away from email. The solution now is that since customers are already using messaging, why not use that as the platform - don't force them to come to you.
Apple and Google won the mobile OS / platform war. Expect those that didn't (FB, AMZN, MSFT) to disintermediate with bot platforms.
- Ryan Block (@ryan) March 30, 2016
“Mobile devices are a really fundamental category, and I don't see them being disrupted for at least a decade, maybe more,” Block said. “Apple and Google won, so anyone who didn't win that game is going to be looking ahead for the next big platform opportunity. It turns out conversational products are where billions of people live, and what's more, WeChat has proven they make a great means of disintermediation.”
The modernization of conversation
During his F8 presentation, David Marcus, Facebook's vice president of messaging products, spoke about the evolution of how we communicate with businesses. “Before the Internet era, everything was conversational: You had to walk to a store, travel agent, or office and talk to someone to get what you needed. Then came the web, and with it, we traded personalization and conversation for interactions at a much, much larger scale. Then came the mobile era, which initially only offered stripped down versions of web, which eventually led to the app world we currently live in. Apps are truly incredible, and they've changed our lives in a profound way.”
“But we download fewer and fewer apps, and we certainly don't turn on push notifications for new downloaded apps anymore,” he continued. “Meanwhile, [Facebook] Messenger has a lot of great properties: It's instant, persists identity from all participants at all times, it's always in context, and all threads are always canonical. That means we're bringing the best of these interactions that I just shared into one place.”
The consensus from people we've spoken with is that although Facebook is a little late to the bot party, its admittance will likely help to accelerate development, progress, and standards among not only the different platforms, but also among brands that want to take advantage of this new era of communication. “Facebook, Kik, Slack, Skype, and others are all playing in what is rapidly emerging as the next big playground for future technology companies,” Messina said.
More information:
Facebook just validated the bot movement for businesses
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