SMBs, business, AI,

Artificial intelligence (AI) is becoming a cornerstone of business strategy for small and medium-sized enterprises (SMBs), according to a JPMorgan Chase survey of more than 2,600 business leaders. 

Nearly four in five SMBs are exploring or have already adopted AI, with around half planning to expand their AI applications in the coming year. 

Despite concerns about costs and cybersecurity, SMBs are positioning AI as a critical tool for efficiency, customer engagement, and growth. 

“Most SMBs need to be mindful of their investments, which often means incremental digital transformation,” said Libby Morgan, chief digital officer at MERGE. 

She explained prioritizing AI functionality that streamlines operations and supports efficiency is a good first step, especially in areas like customer service where chatbots and virtual assistants can improve response times and free up resources. 

JPMorgan’s findings indicate SMBs are particularly drawn to AI’s potential in marketing, customer service, and data analysis. 

These applications are expected to see significant adoption, with 56% of businesses planning to use AI for marketing, 47% for customer service automation, and 44% for data-driven decision-making. 

“Capturing customer data, insights, and preferences should be a priority,” Morgan said. “Clean, organized data is key to optimizing AI outcomes, enabling better customer targeting and more effective marketing strategies.” 

The Cost of Innovation 

Implementing AI solutions is not without its challenges: Nearly half of SMBs surveyed said they plan to increase technology spending, with two in five expecting higher capital expenditures.  

This investment reflects growing confidence, as two-thirds of SMB leaders predict higher profits and sales in the coming year. 

Jeff Klemens, a partner at Sageview Capital, emphasized the cost-effectiveness of AI for SMBs.  

“The good news is that most AI application solutions on the market today are relatively small investments compared to the potential benefit,” he said. “Trialing solutions in different areas lets businesses assess impact and invest more heavily in what delivers the best results.” 

Both Klemens and Morgan stressed the importance of piloting AI initiatives before scaling them.  

“A test-learn-optimize approach is essential,” Morgan said. “Clear KPIs and metrics should be established to measure results, enabling SMBs to pivot quickly if a pilot isn’t meeting expectations.” 

Klemens echoed this sentiment, noting the value of focusing on high-impact applications. 

“Set a timeframe for evaluation, assess results, and concentrate on one or two initiatives that yield the most benefit,” he said. 

Maximizing ROI Through Smart Investments 

The key to maximizing ROI from AI lies in aligning investments with business goals and leveraging tools to improve efficiency, with Morgan advising SMBs to seek objective guidance when implementing AI. 

“Hiring an experienced partner to help create a business case and prioritize investments can make all the difference,” she said. “AI implementations should always be rooted in industry expertise and best practices.” 

Klemens highlighted the importance of managing and monitoring AI tools closely during trials.  

“Set clear performance targets and deadlines for evaluation,” he said. “AI tools can even assist in creating detailed project plans to ensure success.” 

Both noted AI has the potential to revolutionize customer interactions and internal processes. 

“Customer service is the number one horizontal AI use case for SMBs today,” Klemens said. “The growing prevalence of AI copilots and code developers is also transforming software development, while sales and marketing applications are poised to deliver significant productivity gains over time.” 

With 48% of businesses planning to add AI tools in 2025, the technology is becoming central to digital transformation strategies. 

As Klemens pointed out, the rapid feedback loop of AI solutions makes them particularly well-suited for SMBs. 

“The ability to test, learn, and scale quickly gives businesses a competitive edge,” he said.