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Facebook Inc (FB): The Bot Army Will Monetize Messenger!

Facebook Inc (FB) made quite a few announcements during the first day of its F8 developer conference. Chief among them was the introduction of Messenger Platform and its first two features — bots and its send/receive API.

FB's New Bots Move Facebook Messenger Closer to MonetizationThe new platform allows businesses to create Facebook Messenger bots to interact with the 900 million people that use FB Messenger every month.

The move opens the door for several interesting developments. First, Facebook Messenger bots provide another way for businesses to interact with consumers through FB Messenger. Second, Messenger Platform in general could supplant Apple Inc.’s (AAPL) App Store and Alphabet Inc‘s (GOOG, GOOGL) Google Play.

Facebook Messenger Bots and Advertising

Facebook didn’t introduce any new ad products within Messenger itself, but it did announce a new News Feed ad product tied to Facebook Messenger. The new “Click to Message” ads, first hinted at by ad chief Andrew Bosworth in September, allow users browsing Facebook to start a Facebook Messenger conversation either with a live representative or Facebook Messenger bot.

Once a conversation is started, users can do things like receive additional product information or news updates from bots, or receive more personalized information from an actual human representative. Either way, it increases the amount of interaction users have with businesses on Messenger, which CEO Mark Zuckerberg has said is the key to monetizing Messenger (or any other product for that matter).

Facebook continues to experiment with re-engagement ads, which allow businesses that have previously interacted with users on Messenger to send them another message — a friendly reminder that the dress you were looking at is back in stock, or the candy you bought last month is on sale today.

Only a few companies are currently participating, and only a small percentage of Facebook Messenger users will receive these kinds of ads, but they do offer the potential to provide a better experience than email marketing. Facebook can filter the number of ads its users receive, and users can also easily stop ads by hitting the block button within FB Messenger.

As more users start interacting with businesses on Messenger, Facebook will see more opportunities to monetize those interactions. This is just one of the early steps toward that end goal.

Will Facebook Messenger Bots Replace the App Store?

There are already several examples of companies that are offering the same functionality as an app with their Facebook Messenger bots. Uber and Lyft allow you to book a ride directly within FB Messenger. 1-800-Flowers allows you to purchase flowers without calling anyone or downloading its app. CNN will send you breaking news through the messaging app instead of its own.

The convenience of not having to download a new app is great, but there are still some drawbacks for Facebook Messenger bots. For example, shopping through Messenger is not as good as shopping in a native app.

But bots could be just the beginning for Messenger Platform.

Providing a platform that allows developers to reach users across multiple operating systems is a powerful thing that could lead to much bigger monetization opportunities for Facebook down the line.

As of this writing, Adam Levy owned shares of AAPL stock.

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