Growth / Apps & Tools

How AI is Helping Small Businesses Beat their Competition

Jennifer Leslie

Updated: Dec 07, 2023 · 8 min read

Toolkit for download in this article

Artificial intelligence AI deep learning computer program technology also machine intelligence, MI is intelligence exhibited by machines.

Unless you’ve been living under a rock, you’ve heard that artificial intelligence is all the rage these days. From robot hotel concierges to a virtual customer service representative—aka chatbot—that takes your pizza order over social media, AI is changing the way companies operate their businesses. In reality, the concept of artificial intelligence, or at least knowledge-based tools, has been around for quite some time.

A brief history of artificial intelligence

During the Cold War, IBM developed an English-to-Russian translation tool through its first scientific computer, the IBM 701 Electronic Data Processing Machine. According to IBM, “This program incorporated logic algorithms that made grammatical and semantic ‘decisions’ that mimicked the work of a bilingual human.” The company went on to develop numerous other cognitive computing systems, most notably Watson, a question-answering computer system that learns with every interaction, and the first building block for many AI programs today.

 What makes AI so robust and informed now is the innumerable data points that exist, gathered through massive databases, online footprints, web cookies, years of search results, and internet-connected devices. Supported by powerful algorithms that help machines sift through this sea of data, businesses now have access to all kinds of datasets (like customer demographics, buying patterns, locale, frequently-searched keywords, etc.) to help improve and simplify their workflow for customer service, marketing and sales, and human resources. It’s even being used to improve fraud detection and beef up cybersecurity efforts. Businesses are now capable of operating on all cylinders, all the time.

What it means for small businesses

That’s all fine and good, you may be saying to yourself, but how would my small business benefit from AI in terms of ROI? Don’t I need a huge budget in order to afford this kind of technology?

You might think so, given that technology giants like Facebook and Google are leading the charge in AI use, but thanks to a number of innovators jumping on the AI bandwagon, the technology has become quite commonplace and affordable, giving businesses big and small more capabilities than ever before. Companies like ChatPath, and Nara Logics are some great examples of this.

The number of small businesses turning to AI to improve their workflow is growing fast. Here are just some ways AI can help your small business gain an edge over your competitors:

Customer service


Chatbots are becoming a staple tool for any customer-facing business. In April 2016, Facebook made it even easier for businesses to deploy their own chatbot as a third party over the Facebook Messenger platform. Chatbots not only provide businesses with a virtual customer service representative, they also help them mine data from their customers to help improve other stages of the sales or support process. Through each interaction with a customer or lead, chatbots are able to learn and retain information pertinent to the situation.

Related Article:

Using Live Chat for Your Small Business

For example, just like a brick-and-mortar store might have a designated associate placed near the entrance to greet customers, online businesses can deploy a chatbot service to provide a similar interaction with visitors, with the option to opt out of that interaction. Should the visitor choose to interact, the chatbot can then provide resources to answer specific queries and can gather important data about the visitor that can then be passed on to a human representative.

Chatbots allow businesses to deploy this aspect of customer service around the clock without having to staff and pay for real-life contact centers. They also provide a “safe” space for customers to give feedback to help businesses improve their tactics, rather than through a face-to-face interaction, which some people may find difficult or intimidating.


Just like you would hand a cashier money at a store, chatbots also guide customers or prospects through the purchasing process in a conversational format and can be customized to allow for creatively-optimized payment features. In September 2016, Facebook announced its Messenger platform would allow 30,000 business-partnered chatbots to accept payment natively, rather than sending customers to an external website. Today, companies of all types, not just retail and foodservice, use chatbots for financial transactions with their prospects and customers.

Marketing & Sales


The need for personalized and relevant content and advertising delivery is more important now than ever, as people’s resistance to mainstream advertising grow higher and tools have become smarter. Companies like Interana and Opentopic are harnessing the power of artificial intelligence to automate valuable insights, like behavioral and predictive analytics, allowing companies large and small to provide highly-personalized customer and user experiences. Chatbots also play a role in personalization, especially when partnered with these kinds of insights. When interacted with, chatbots are able to discern further details about a prospect’s specific needs and can use its cognitive abilities to either provide them with the answers or services they’re seeking or pass their query on to a human representative with a full customer data report.


Although maybe not an obvious use of artificial intelligence, it might be one of the more important for your small business. Take Udacity, for example. The massive, online education organization was able to improve sales by 50 percent when it built its own bot based on prior sales conversation transcripts and recordings that could differentiate certain sets of words and dialogues that led to success from those that didn’t. From there, the bot was designed to recommended dialogue or directions to the human salespeople. Companies like provide similar services (so you don’t have to build your own bot!).

Human resources

AI applications can also be used to help businesses streamline their hiring processes and make smarter hiring decisions. Not only can HR leaders utilize these kinds of products to scan resumes and applications for keywords, they can also analyze applicant responses and profile information for culture fit and relevant experience.

And we can’t forget our friend, the chatbot. Chatbots like Talla are used to help streamline the interview process by asking applicants a series of questions related to the job title, so HR professionals can focus on more strategic HR issues. Chatbots can also be used internally to help answer frequently-asked questions or act as a virtual assistant to help schedule meetings and manage calendars.

AI Lite

Still not sure you have the budget or capacity for a full AI overhaul? There are still some ways you can upgrade your business processes without breaking the bank. According to the Harvard Business Review, there are less expensive, knowledge-based approaches to business that can organize data and languages into “highly malleable and helpful blocks of information,” aptly labeled “AI Lite.” These type of systems might not learn new tricks unless code is added to their programs to help “teach” them, but they can still become quick and smart when it comes to organizing and distributing information.

Whatever route you choose to implement, know that artificial intelligence is not a one-size-fits-all solution. Although many technologies available to small businesses today provide a variety of extensive services with purchase, your first deployments aren’t going to be perfect. You’ll still need to roll up your sleeves and learn the technology, especially if you decide to go the route of AI Lite, but the payoff down the line will be worth the effort.

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