Bots vs. Apps: Who Wins? Let the Dollars Decide – NYC M1 Summit


The M1 Summit in NYC last week was a dynamic blend of mobile innovators and early stage investors. The companies on the program have raised nearly $1 billion to date.

One of the first topics to leap to the fore was the issue of the rise of Bots, or Chatbots, versus the future of Apps. There appeared to be a general consensus that the app area is saturated. Apps were described by one investor as “calcified.” With over 3 million apps combined in the Google Play Store and Apple App Store, the sense was that it’s increasingly difficult to make money with new apps and even to get customer recognition and engagement.

With apps having difficulty gaining traction with consumers, the advantages of Bots were explored by a number of presenters.

Bots, “Conversational Commerce” and Messaging

Bots have been receiving a wild amount of publicity, particularly since Facebook announced in April, its “bots on Messenger” offering. The company allows developers to build bots within its 900 million-strong Messenger chat/messaging platform.

However, the M1 presenters have mostly been at work on their bots or messaging-based services for some time, not necessarily related to the Facebook initiative.

The presenters included a number of companies that illustrated a range of how messaging capabilities were being used for “conversational commerce.” was formerly called GoButler. Its new service enables vendors in a wide range of verticals to build conversational user interfaces. The company emphasizes its history with GoButler, providing a flight search app that allowed it to study millions of examples of consumers in “real conversations.” The company’s natural language processing (NLP) uses deep learning and machine learning technology. stated that social media commerce is moving to messaging. They started their service with a human interface. However, they found that people want immediate responses and consistency of responses, which doesn’t occur with humans in the middle. Expressing a request in natural language is a better UI than text. Where they can, they will automate. They find that people’s expectations go up when messaging is used. They believe that messaging apps can become a new type of OS.

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Prompt bills itself as “a command line for the real world.” Users who download the app can use text to communicate with dozens of providers, such as Uber, Weather Channel, Zillow. The service requires a structured command input by the user, such as @nest68, to change the temperature via a Nest controller. Thus it is not purely using natural language. Prompt stated that the conversational approach is the quickest way for a user to interact with a service since no installation is required.

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Trim is a service that offers to detect and cancel unused and unwanted subscriptions that consumers typically overlook and keep paying month after month. Once a subscriber signs up, the service searches a reported 15,000 U.S. financial institutions to find the user’s accounts. It then uses its analytical software, “AI (artificial intelligence) in the cloud,” to identify recurring payment charges.

The software then presents the user with the list of subscriptions, from which the person can select the ones to delete. The company takes care of the headaches in effecting the cancellations. The communication between user and the service uses SMS. Trim stated that SMS is a high trust channel.

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Shine Text

Shine Text uses SMS to provide users with positive daily messages aimed at improving confidence, happiness, mental health and productivity. The company has been working in SMS for five years. They count 5 million young people as users and state that SMS is “40X more effective than email.” They recognize that there is a risk with texts, that the message persists and is “incredibly personal.”

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One of the bot-type services discussed at the conference (although not presenting) was Poncho, a weather forecasting offering. Poncho provides personalized weather information in an amusing, entertaining manner, through a cat that can converse with the user, through a Messenger-based bot capability. (We recently wrote about consumer-oriented mobile weather apps, including Carrot, whose approach was to make the messages fun and humorous.)

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The Best, and Worst, of Bots

Bots can be used for many purposes, beneficial and insidious. In the latter category, as we discussed in a recent article, are bots, automated programs to create hits on websites, building up supposed web traffic to falsely increase advertising fees, under the guise of being humans. This has led to the prevalence of “CAPTCHA” identity authentication sign-ins on numerous sites. (Completely Automated Public Turing test to tell Computers and Humans Apart).

However, the bots that are now the current source of enthusiasm are actually “chatbots,” machines armed with machine intelligence than can simulate conversations, typically with consumers.

Used in conjunction with messaging apps, they create a shortcut for engaging with a consumer. The bot, in many cases, is replacing the alternative, which is to have a human intermediary on both sides of the conversation or transaction.

Our Take

The conference particularly emphasized the role of bots in commercial and informational uses, how bots can “bring brands into a consumer’s personal space.”

The M1 conference session illustrated a number of different approaches to using various forms of messaging for reaching individuals, particularly consumers. Some of them do not, in fact, appear to be particularly “conversational,” but rather one-sided uses of messaging capabilities.

Example: Trim’s apps will do the analysis for a user who wants to examine their outstanding subscriptions and all the user has to do is respond to a form by checking off the ones they want to cancel.

Example: Shine Text appears to use SMS for basically a one-way communication to deliver an inspirational message.

The potential of SMS has been recognized for some time. An SMS-based mobile marketing client of ours back in 2008 wrote this in its business plan: “SMS offers access to a massive and growing audience of mobile users and is a very effective ‘opt-in’ method for advertising and a wide array of commercial applications as well as for other types of information services.” It highlighted the ease of implementation at that time.

One thing that is new is the advancing state of artificial intelligence, which enables the sense of two-way conversation, with a machine on one side. As this development is moving ahead, bots, we believe, are a likely indicator of things to come.

We would expect a flowering of Bot types and uses for the next few years. Looking further down the road, we agree with one of the Eniac firm’s presenters who stated that advances in machine intelligence will lead to virtually all things being “automatically smart.” Thus Bots won’t continue to be a separate category, but something that is incorporated in devices all around us.

Visit the M1 Summit NYC 2016 website: