The Complete Beginner’s Guide To Chatbots

Everything you need to know.

What are chatbots? Why are they such a big opportunity? How do they work? How can I build one? How can I meet other people interested in chatbots?

These are the questions we’re going to answer for you right now.

Ready? Let’s do this.

(Do you work in ecommerce? Stop reading and click here, we made something for you.)

(p.s. here is where I believe the future of bots is headed, you will probably disagree with me at first.)

(p.p.s. My newest guide about conversational commerce is up, I think you’ll find it super interesting.)

“~90% of our time on mobile is spent on email and messaging platforms. I would love to back teams that build stuff for places where the consumers hang out!” — Niko Bonatsos, Managing Director at General Catalyst

p.s. Sign up for my newsletter here.

What Is A Chatbot?

A chatbot is a service, powered by rules and sometimes artificial intelligence, that you interact with via a chat interface. The service could be any number of things, ranging from functional to fun, and it could live in any major chat product (Facebook Messenger, Slack, Telegram, Text Messages, etc.).

“Many businesses already have phone trees and they do work though most users get grumpy using them. Text based response trees are much easier and faster and that is what I expect a lot of early bot interactions to be. Sometimes with ability to chat with a live person.” — Josh Elman, Partner at Greylock

If you haven’t wrapped your head around it yet, don’t worry. Here’s an example to help you visualize a chatbot.

Example:

If you wanted to buy shoes from Nordstrom online, you would go to their website, look around until you find the shoes you wanted, and then you would purchase them.

If Nordstrom makes a bot, which I’m sure they will, you would simply be able to message Nordstrom on Facebook. It would ask you what you’re looking for and you would simply… tell it.

Instead of browsing a website, you will have a conversation with the Nordstrom bot, mirroring the type of experience you would get when you go into the retail store.

Facebook Showing Examples of Chat Bots

Watch this video from Facebook’s recent F8 conference (where they make their major announcements). At the 7:30 mark, David Marcus, the Vice President of Messaging Products at Facebook, explains what it looks like to buy shoes in a Facebook Messenger bot.

Examples of Chatbots

Buying shoes isn’t the only thing chatbots can be used for. Here are a couple of other examples:

• Weather bot. Get the weather whenever you ask.
• Grocery bot. Help me pick out and order groceries for the week.
• News bot. Ask it to tell you when ever something interesting happens.
• Life advice bot. I’ll tell it my problems and it helps me think of solutions.
• Personal finance bot. It helps me manage my money better.
• Scheduling bot. Get me a meeting with someone on the Messenger team at Facebook.
• A bot that’s your friend. In China there is a bot called Xiaoice, built by Microsoft, that over 20 million people talk to.

See? With bots, the possibilities are endless. You can build anything imaginable, and I encourage you to do just that.

But why make a bot? Sure, it looks cool, it’s using some super advanced technology, but why should someone spend their time and energy on it?

It’s a huge opportunity. HUGE. Scroll down and I’ll explain.

Why Chatbots Are Such A Big Opportunity

You are probably wondering “Why does anyone care about chatbots? They look like simple text based services… what’s the big deal?”

Great question. I’ll tell you why people care about chatbots.

It’s because for the first time ever people are using messenger apps more than they are using social networks.

Let that sink in for a second.

People are using messenger apps more than they are using social networks.

“People are now spending more time in messaging apps than in social media and that is a huge turning point. Messaging apps are the platforms of the future and bots will be how their users access all sorts of services.” — Peter Rojas, Entrepreneur in Residence at Betaworks

So, logically, if you want to build a business online, you want to build where the people are. That place is now inside messenger apps.

“Major shifts on large platforms should be seen as an opportunities for distribution. That said, we need to be careful not to judge the very early prototypes too harshly as the platforms are far from complete. I believe Facebook’s recent launch is the beginning of a new application platform for micro application experiences. The fundamental idea is that customers will interact with just enough UI, whether conversational and/or widgets, to be delighted by a service/brand with immediate access to a rich profile and without the complexities of installing a native app, all fueled by mature advertising products. It’s potentially a massive opportunity.” — Aaron Batalion, Partner at Lightspeed Venture Partners

This is why chatbots are such a big deal. It’s potentially a huge business opportunity for anyone willing to jump headfirst and build something people want.

“There is hope that consumers will be keen on experimenting with bots to make things happen for them. It used to be like that in the mobile app world 4+ years ago. When somebody told you back then… ‘I have built an app for X’… You most likely would give it a try. Now, nobody does this. It is probably too late to build an app company as an indie developer. But with bots… consumers’ attention spans are hopefully going to be wide open/receptive again!” — Niko Bonatsos, Managing Director at General Catalyst

But, how do these bots work? How do they know how to talk to people and answer questions? Isn’t that artificial intelligence and isn’t that insanely hard to do?

Yes, you are correct, it is artificial intelligence, but it’s something that you can totally do yourself.

Let me explain.

How Chatbots Work

There are two types of chatbots, one functions based on a set of rules, and the other more advanced version uses machine learning.

What does this mean?

Chatbot that functions based on rules:

• This bot is very very limited. It can only respond to very specific commands. If you say the wrong thing, it doesn’t know what you mean.
• This bot is only as smart as it is programmed to be.

Chatbot that functions using machine learning:

• This bot has an artificial brain AKA artificial intelligence. You don’t have to be ridiculously specific when you are talking to it. It understands language, not just commands.
• This bot continuously gets smarter as it learns from conversations it has with people.

“Beware though, bots have the illusion of simplicity on the front end but there are many hurdles to overcome to create a great experience. So much work to be done. Analytics, flow optimization, keeping up with ever changing platforms that have no standard. For deeper integrations and real commerce like Assist powers, you have error checking, integrations to APIs, routing and escalation to live human support, understanding NLP, no back buttons, no home button, etc etc. We have to unlearn everything we learned the past 20 years to create an amazing experience in this new browser.” — Shane Mac, CEO of Assist

Bots are created with a purpose. A store will likely want to create a bot that helps you purchase something, where someone like Comcast might create a bot that can answer customer support questions.

“Messaging is where we spend a ton of our time and expect to communicate. It is ridiculous we still have to call most businesses.” — Josh Elman, Partner at Greylock

You start to interact with a chatbot by sending it a message. Click here to try sending a message to the CNN chatbot on Facebook.

Artificial Intelligence

So, if these bots use artificial intelligence to make them work well… isn’t that really hard to do? Don’t I need to be an expert at artificial intelligence to be able to build something that has artificial intelligence?

Short answer? No, you don’t have to be an expert at artificial intelligence to create an awesome chatbot that has artificial intelligence. Just make sure to not over promise on your application’s abilities. If you can’t make the product good with artificial intelligence right now, it might be best to not put it in yet.

“Everyone going after AI to try make this scale seems a little too soon. Texting to a computer that doesn’t understand many things you are saying can be very aggravating. So be careful early not to over promise, and give users guard rails” — Josh Elman, Partner at Greylock

However, over the past decade quite a bit of advancements have been made in the area of artificial intelligence, so much in fact that anyone who knows how to code can incorporate some level of artificial intelligence into their products.

How do you build artificial intelligence into your bot? Don’t worry, I’ve got you covered, I’ll tell you how to do it in the next section of this post.

How To Build Chatbots

Building a chatbot can sound daunting, but it’s totally doable. You’ll be creating an artificial intelligence powered chatting machine in no time (or, of course, you can always build a basic chat bot that doesn’t have a fancy AI brain and strictly follows rules).

“The difficulty in building a chatbot is less a technical one and more an issue of user experience. The most successful bots will be the ones that users want to come back to regularly and that provide consistent value.” — Matt Hartman, Director of Seed Investments at Betaworks

You will need to figure out what problem you are going to solve with your bot, choose which platform your bot will live on (Facebook, Slack, etc), set up a server to run your bot from, and choose which service you will use to build your bot.

“We believe that you don’t need to know how to program to build a bot, that’s what inspired us at Chatfuel a year ago when we started bot builder. We noticed bots becoming hyper-local, i.e. a bot for a soccer team to keep in touch with fans or a small art community bot. Bots are efficient and when you let anyone create them easily magic happens.” — Dmitrii Dumik, Founder of Chatfuel

Here are a ton of resources to get you started.

Platform documentation:

• Facebook Messenger
• Slack
• Discord
• Telegram
• Kik

“It’s hard to balance that urge to just dogpile the latest thing when you’re feeling like there’s a land grab or gold rush about to happen all around you and that you might get left behind. But in the end quality wins out. Everyone will be better off if there’s laser focus on building great bot products that are meaningfully differentiated.” — Ryan Block, Cofounder of Begin.com

Other Resources:

• How Bots Will Completely Kill Websites and Mobiles Apps by Matt Schlicht
• Botlist, an app store for bots.
• The Secret To Building Your Own Facebook Chat Bot In Less Than 15 Minutes by Jerry Wang
• Go Library for Facebook Messenger Bots by Harrison Shoebridge
• How To Build Bots For Facebook Messenger by Facebook
• Building Your Messenger Bot [Video] by Facebook
• Creating a Bot by Rob Ellis
• Botwiki
• Telegram Bot API — PHP SDK by Syed Irfaq
• A Beginner’s Guide To Your First (Slack) Bot by Slack
• Slackbot Tutorial by Michi Kono
• Create A Slackbot Using Botkit by Altitude Labs
• Sketch UI Kit For Messenger Bots by Mockuuups
• How to create your own Telegram bot who answer its users, without coding by Chatfuel
• Chatbots.org

Don’t want to build your own?

• Contact me.

Now that you’ve got your chatbot and artificial intelligence resources, maybe it’s time you met other people who are also interested in chatbots.

How To Meet People Interested In Chatbots

Chatbots have been around for decades, but because of the recent advancements in artificial intelligence and machine learning, there is a big opportunity for people to create bots that are better, faster, and stronger.

If you’re reading this, you probably fall into one of these categories:

1. You want to learn how to build a chatbot.
2. You are currently building a chatbot or you have already built one.
3. You want to build a chatbot but you need someone else to help you.
4. You are researching chatbots to see if you and your team should build one.
5. You are an investor potentially interested in investing in chatbot startups.

Wouldn’t it be awesome if you had a place to meet, learn, and share information with other people interested in chatbots? Yeah, we thought so too.

That’s why I created a forum called “Chatbot News”, and it has quickly become the largest community related to Chatbots.

The members of the Chatbots group are investors who manage well over $2 billion in capital, employees at Facebook, Instagram, Fitbit, Nike, and Ycombinator companies, and hackers from around the world.

We would love if you joined. Click here to request an invite private chatbots community.

I have also created the Silicon Valley Chatbots Meetup, register here to be notified when we schedule our first event.

That’s all for now!

I wish you luck in your journey to create your own chatbot and to dive headfirst into the world of artificial intelligence (if you haven’t already). Join us in this private community if you want to talk more.

Do you have an ecommerce company? We launched Octane AI, and we can help you do it. Learn more here.

Want to chat about bots? Are you thinking of making a cool bot? Are you investing in bots? Do you want feedback on your bot? Send me a message now.

I promise it will be the real me that responds and not a bot.

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