Impact of AI on Small Businesses

by | Mar 2, 2022

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Impact of AI on Small Businesses

The present generation has witnessed incredible technologies in the last decade. Those technologies would have been unthinkable for the preceding generation. Artificial intelligence is one example of the same.

There is no denying that Artificial Intelligence & Machine Learning is influencing every part of the tech industry. It is helping businesses around the world to grow, especially the small ones. It is considered the most disruptive technology of the current times.

The global AI market is expected to multiply over the next few years, reaching a $190.61 billion market value by the year 2025. The projected growth rate of AI between 2020 and 2027 is 33.2%.

Let us look at what Artificial Intelligence (AI) is and how small businesses can use it to scale their business.

What is Artificial Intelligence?

What is Artificial Intelligence

Artificial Intelligence is a technology wherein a machine can mimic human cognition. No software has an actual brain and thinks. However, it can be programmed to solve reasoning, learning, and perception problems. AI models are capable of making the right decisions and performing even difficult tasks. To train and develop them, organizations use data labeling to annotate patterns to develop AI models.

Even though AI is not a replica of what humans can do, it can be used to interpret languages, make predictions, and perform different tasks. AI is now used by almost all app development companies around the world.

According to Oxford Dictionary, AI is the development of computer systems able to perform tasks that usually require human intelligence, such as visual perception, speech recognition, decision-making, and translation between languages.

Impact of AI on small Business

Let us look at the impact of AI on small businesses in various areas, and how it can help you upgrade your business:

1. Customer Service

Irrespective of operating a small business or a well-established business; The need of providing excellent customer service doesn’t rule out. If you want to retain your existing customers and grow as a company, this is one area that cannot be compromised.

For a small business, the cost is also an essential factor. They cannot hire many customer service reps to provide support.

AI comes to use for business in this regard. Small businesses are using chatbots which are an affordable way to answer customer queries, save on employee cost and maximize availability to customers where support is required from the actual rep.

The AI-driven chatbots can easily be integrated into the business social media page, website, etc, and give an unlimited opportunity for customer engagement. These chatbots can help answer frequently asked questions (FAQs) or direct queries from customers where a chatbot can read the database and answer.

The usage can vary depending on the industry – AI can be used for troubleshooting, starting a conversation, or helping customers in the payment process.

All these come under customer experience, and you should explore and upgrade your business to provide better customer service to their customers using AI.

2. Improve Sales and Marketing with AI

Improve Sales and Marketing with AI

Customer Relationship Management (CRM) systems have been around for a while. However, AI has changed its dynamics and how businesses use them. The CRM system aims to gather customer data from different communication channels like phone, social media, email, etc. which eventually helps generate more leads that assist with scaling businesses.

Many small businesses have started using CRM systems backed by AI to efficiently manage customer feedback apps. It helps them analyze feedback.

These communication channels and then automatically adjust lead generation and advertising plans for businesses based on the above information.

Studies have shown that AI-driven CRM Software can generate more leads for businesses for the same amount of marketing dollars. In short, they can optimize the entire customer acquisition process for you.

3. In the Hiring Process

Hiring the right talent in a short time is essential for every business. The right talent will help in the business growth, and a short time will ensure the hiring cost becomes lower.

HRs are using AI tools such as Applicant Tracking System (ATS) that help them screen resumes much faster and give more time to candidates who are more qualified for the job requirement. Using such AI talent acquisition tools, the collection of names, qualifications, and addresses is unbiased, and hence the business gets the best talent pool.

Initially, the AI-driven system may not be capable enough to understand what kind of candidates the business is looking for. Machine Learning comes to usage here – you make the system learn the best connections between candidates and company goals. AI and ML in tandem work best for hiring managers.

Several applicant tracking systems for managers combine these incredible benefits to improve the recruitment process. For example, some tools allow companies to assess their candidates continually and give them a gauge of how their recruitment style is fairing. On the other hand, other great solutions can help companies make an utterly customizable recruitment solution.

AI works in other areas of hiring and is not limited only to screening. During the interview process, it can be used to automate communication to the selected candidate, analyze performance tasks, and much more. In short, AI promises to revolutionize recruitment to select the best applicants for small businesses.

4. Administrative Tasks

Every business has time-consuming and repetitive administrative tasks. A well-established business can hire employees and can get it done – cost is not a concern for them. For a small business, a cost saved translates to business growth. Hence, small businesses are turning to AI to automate tasks related to timesheets, paperwork, and scheduling.

AI is helping businesses to compile reports and analyze historical data – the best part is, it compiles data in much less time. As a result, the business saves employee costs and can make faster business decisions. In addition, it helps them unlock opportunities and focus on more pertinent responsibilities.

Another advantage of using AI is that the error in reporting goes down significantly. Also, reports can be produced based on different parameters. Generating different reports is easy once the data is fed in a system driven by custom AI development. An employee may have to start from scratch for every report, AI does not. Forward-thinking small business owners are using AI and taking the path of faster business growth.

5. Boosting Cybersecurity

Boosting Cybersecurity

Cybersecurity is critical for all business owners. In today’s digital world, so much information flows between you and your customers, you store detailed information about your customers. With today’s ever-evolving cyber-attacks and proliferation of devices, no business is safe. Machine learning and Artificial intelligence can be used to fight the bad guys, automating threat detection and responding more efficiently than traditional software-driven approaches.

Cybersecurity AI reviews the behavior pattern of your business software, apps, and stored information. It interprets what your employees and customers do with the tools and how they do it. Based on the above information, AI can recognize acceptable and relevant things.

It means it can tell what valid links or email messages are, when a task needs to be completed, etc. If there is something that is not normal (let’s say, for example – links with an outside domain), AI reacts and raises the red flag.


AI is redefining small business operations in many ways. You should not stay back and delay your growth by not using AI. AI is available 24*7 which is one of the biggest advantages of introducing AI in your business.

This article shares some valuable insights into how it can be used. You should get in touch with app development companies and discuss with them how AI can help your business grow.

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