New content, same picture? A new AI-driven marketing age is here but marketing budgets have been repeatedly slashed as the economy has flatlined. How can small firms afford to adapt and invest and make the impact they need to survive?

How is small business marketing behaviour changing?

Austerity is proving to be a long-term condition and in the face of prolonged headwinds, small businesses have had to cut their cloth accordingly. Spending across the board has been affected, including that on marketing. However, not everyone is following the same path.

New research from Iwoca paints an interesting picture. According to the study, the use of social media influencers is growing among small businesses, with the vast majority of those adopting the strategy benefiting from doing so (at almost 90%). Tellingly, the strategy is most popular among business owners aged 44 or under.

The shift in behaviour from small business owners in terms of marketing strategy is arguably symptomatic of a wider rejection of traditional marketing norms, something driven partly at least by cost-conscious planning.

Notably, the use of micro influencers is forecast to be a top small business marketing trend in 2024, alongside personalisation and customer experience, social commerce and shoppable content, video marketing and sustainable and purpose-driven marketing.

Small firms and the future of AI-driven marketing

Of course, it’s impossible to mention any of these trends without bringing in discussion of AI. It is changing the face of marketing – that much is already very clear – and given what can be achieved and at what speed and cost, its appeal to cash-strapped small businesses is obvious.

However, the use of AI in marketing is far from a straight line. Marketing is only worth doing if it makes the right impact and that needs human emotion and the human execution of ideas based on human emotion. As yet, AI isn’t up to the job – it is a tool but not a replacement. And this means that meaningful investment in marketing teams remains essential.

Managing marketing costs and how alternative lenders can help

If small businesses are rushing head long into AI-driven marketing, it is easy to understand why. The pressure on margins is incredible – firms are being squeezed at every point. So, how do businesses plot the right marketing path while safeguarding cashflow? Alternative finance can help.

Services such as invoice finance, asset finance and peer-to-peer lending are proving a vital source of capital for small businesses in the current funding climate (with 65% more SMEs experiencing difficulty in accessing finance from high-street banks). These alternative finance facilities, which offer a more easily accessible, affordable and personalised approach to lending, are helping small businesses survive and target recovery, stability and growth.

This profile has helped cement the reputation of alternative finance in the business sector. According to the British Business Bank, it is alternative lenders that are increasing filling the small business funding gap, with asset finance alone rising by 7% to £23.5 billion in 2023. At the same time, a 2024 study shows that more and more SMEs are turning to alternative lenders to access larger-scale finance packages.

Small firm finance options for AI-age marketing spend

The nature of small businesses marketing is undergoing a seismic shift, with the pressure on spending power doing a lot to frame thinking. Most notably, with regard to AI, the potential for cash-strapped firms to reap significant rewards is clear.

However, whatever its form, marketing still requires investment, even in the face of AI shortcuts. This is why, with challenges mounting in relation to high-street bank small-firm lending, it is vital that businesses are aware of all the finance options available to them, including the services of alternative lenders.

To find out more about A&T Business Associates services, contact Steve Bowles on 01903 602211 or steve.bowles@atbusinessassociates.co.uk.