uploads///Facebook Chatbot

How Facebook Plans to Monetize Its Messenger App

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Nov. 20 2020, Updated 12:07 p.m. ET

Facebook unveils chatbots

Facebook (FB) hasn’t given a specific monetization timeline for Messenger. However, we believe that the company is slowly getting closer to monetizing its Messenger app. Facebook during its recently concluded F8 developer conference unveiled its plan to expand the Messenger app by providing tools to build chatbots and in turn charging companies for “sponsored messages.”

Simply put, a chatbot is an artificial intelligence software program that intends to revolutionize the way users and brands connect with each other. According to Facebook “Bots can provide anything from automated subscription content like weather and traffic updates to customized communications like receipts, shipping notifications, and live automated messages all by interacting directly with the people who want to get them.”

Companies like 1-800-Flowers (FLWS), Hyatt Hotels (H), and Time Warner’s (TWX) CNN are already live. Importantly, Facebook has given the option to people to block the ads.

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Facebook’s other initiatives to monetize Messenger

Last year, Facebook announced that third-party developers can develop apps that directly integrate with Messenger. This way, developers can monetize their apps, and Messenger keeps a cut.

Facebook also started allowing users to transfer money to others through its Messenger application. Facebook’s intention to enter the person-to-person money market became clear when it hired the former president of PayPal (PYPL). In December 2015, Facebook launched Transportation on Messenger, which allows users to book an Uber ride from the Messenger app.

To get portfolio exposure to Facebook, you can consider investing in the PowerShares QQQ Trust, Series 1 ETF (QQQ).

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