Small business owners adopting AI: The commercialization of AI

• Author:
• Author name

  Quantumrun Foresight
• August 10, 2023

Insight highlights

In 2018, 14% of SMBs utilized AI for operations and customer engagement. AI effectively automates labor-intensive tasks, optimizes content strategy, and enhances CRM systems. AI-driven chatbots provide cost-effective round-the-clock customer service. Despite AI adoption leading to personalized services and competitiveness, it raises privacy concerns, calls for regulatory changes, necessitates upskilling, and could create a digital divide among businesses.

Small business owners adopting AI context

According to a 2018 study by coaching organization Vistage in partnership with Salesforce, nearly 14 percent of small and midsize businesses (SMBs) used AI across all functions. The most automated areas were business operations (51 percent) and customer engagement (45.5 percent). Nearly 58 percent of SMB CEOs think advanced technologies will significantly affect their businesses in the coming years.

The true advantage of AI for modern businesses lies in its capacity to handle labor-intensive tasks efficiently. In sales, AI automates the process of identifying opportunities and forecasting trends. Within customer service, it streamlines interactions and manages ongoing operations. In marketing, AI excels in targeting potential customers, while in e-commerce, it offers personalized product recommendations. Artificial intelligence also plays a crucial role in operations, assisting companies with preventative maintenance, addressing production line issues, and optimizing machine settings for maximum efficiency.

However, some experts suggest SMBs ask the right questions about AI. Lee Blackstone, the founder of consulting firm Blackstone+Cullen, said that many business owners approach him for guidance on investing in AI. The questions they should be asking are how are they preparing for its implementation, what does success look like for them, and how they expect AI to transform their businesses.

Disruptive impact

One of the tasks that SMBs are increasingly delegating to AI is automated content strategy and production. Content marketing aims to draw in new customers, engage followers, and increase brand awareness by utilizing social media posts, blogs, emails, e-books, and other mediums. AI uses algorithms to analyze existing data and identify the most popular types of content. Additionally, AI's insights make it easier to select keywords, post frequency, and topics for future posts. Various tools are also available to automate blog, social media, and newsletter production.

Artificial intelligence enables businesses to gain valuable insights into customer preferences and desires, allowing for better-informed decision-making. By incorporating AI into customer relationship management (CRM) systems, organizations can streamline mass communication and enhance organization. AI-powered CRM can effectively "listen" to customers by gathering and analyzing data from various channels, such as email newsletters and social media, in ways humans cannot achieve. This strategy enables tailored marketing and communication campaigns.

Customer service is yet another task that AI is doing well. To optimize employee expenses and accessibility to clients, small businesses are using chatbots as a cost-effective solution. These AI-driven programs or add-ons can be integrated into a website or app, providing round-the-clock customer interaction. Chatbots are configured using existing materials, such as frequently asked questions (FAQs) and predefined replies, to develop the most suitable response to an inquiry. As chatbots receive more usage and customer feedback, their performance and efficiency also improve.

Implications of small business owners adopting AI

Wider implications of small business owners adopting AI may include: 

• More personalized and efficient services, leading to improved SMB customer satisfaction metrics. However, the increased reliance on AI could also exacerbate privacy concerns and potential surveillance issues.
• Increased competitiveness of small businesses, enabling them to scale more rapidly and compete with larger corporations, resulting in increased economic growth and innovation in various industries.
• AI contributing to the growth of small businesses in remote or underserved areas, helping to reduce regional disparities in terms of economic opportunities and development.
• Demand for more affordable AI-driven technologies growing, driving innovation in natural language processing, computer vision, and machine learning.
• More energy-efficient operations, reducing the environmental footprint of SMBs. AI can also help small businesses optimize resource utilization, minimize waste, and improve sustainability practices.
• A more level playing field in the global market, leading to increased competition and collaboration among SMBs.
• Job opportunities in the AI industry, requiring employees to upskill or reskill to remain relevant in the job market. This factor includes a greater need for education and training programs that focus on AI skills, both for entrepreneurs and their employees.
• A digital divide where businesses with access to AI technologies outperform those without. This trend could worsen existing market inequalities, making it more difficult for some companies to succeed.

Questions to consider

• If you’re an SMB owner, how is your company using AI, if at all?
• What are the other potential benefits and challenges of adopting AI for smaller companies that don't have enough resources?