The simple answer is that when I get to lecture to or meet with small business owners, they are only vaguely aware of it. For so many of them, it is some sort of futuristic robot that could take over the world one day. Unfortunately, that’s not true. The way I see it, it’s not futuristic because it’s already here. As far as taking over the world, well I don’t know, but it has created the biggest change in the market and business landscape already.
As small business owners, we know that those of us who refuse to change or innovate, don’t make it in the long run. If it can happen to large businesses like Sears, Toys R Us and Circuit City, it can easily happen to small local businesses. The thing about AI is that it is accelerating the pace at which we have to change and adapt to stay competitive. Let me show you how.
So, What is AI?
At its core, AI is the science of making machines intelligent. It involves developing computer systems that can perform tasks that typically require human intelligence, such as learning, reasoning, problem-solving, and perception. Yes, imagine Siri or Alexa but on steroids!
For the last five years, I have been shouting that we need to learn how to use it to our advantage. Amazon, Google, Netflix, Tesla, Microsoft are investing mind boggling amounts to perfect it to their benefit. Let’s take Amazon for example.
Amazon is using it to:
Provide Product Recommendations. When you log on to Amazon, AI analyzes what you have bought before, what searches you’ve done on the internet and uses that information to show you the products you see and hides others it doesn’t want you to see.
Organize its Supply Chain. AI uses the inventory it has and where to make sure it doesn’t have too many items or too little. It predicts how much demand for a particular item there will be based on people searching on the internet. Finally, it improves the money saving way to pack and ship products.
Amazon Alexa: AI-powered voice assistant that can control smart devices, answer questions, and provide information.
Now imagine that you had access to all this for your own business. Think about the many ways it could save you time and money. I have great news for you. You can have AI working for you too. The best part about it, is that it can be very affordable for small businesses to use.
When I tell this to the business owners we help, they are usually surprised. The trick is to know what AI resources are out there and put them together in a package that is custom to your business needs. It works for both goods and service based businesses.
The bad news is that these big corporations are teaching AI and it’s learning from them. Guess who the results are going to favor. Big business does not have our well-being at heart. Small business owners like you and I have to get in the game and use it to our advantage.
To illustrate, let’s use the example of Carlos. He owns a butcher shop and has five employees. H-E-B has a store only a couple of miles down the road.
How Can Bob’s Small Businesses Benefit from AI?
A traditional butcher shop might seem like an unlikely place for artificial intelligence, but the integration of AI would revolutionize the customer experience and business operations. By analyzing customer data and preferences, Bob can tailor its offerings to individual needs, enhancing customer satisfaction and driving sales.
Here's how AI can be applied in a butcher shop.
Personalized Customer Experience:
Personalized Product Recommendations: AI can look at a customer’s browsing history. AI notices that this customer has been searching the internet for birthday party supplies. AI also sees that the customer’s birthdate is coming up from her facebook profile. Imagine that the next time the customer comes into Bob’s shop to buy her usual pound of hamburger beef, AI identifies her from her phone signal. Bob gets a notification on his screen reminding him that her birthday is coming up. Bob can now remind the client that he has party platters available when ordered in advance and that because she’s a loyal customer, he will extend a 10% discount on her party platter order. That’s just a simple example, but it shows the extent of what AI can do.
Valuable Tailored Information: Bob has a customer that AI has noticed belongs to some Grill Masters groups on Facebook and follows Chefs that specialize in grilling on his Instagram account. AI can send him a post on Bob’s behalf of the winning recipe of last year's winner of the Grill Masters Championship. This is information that the customer would value and remember that Bob was looking out for him.
Targeted Marketing Campaigns:
Seasonal Promotions: Sure, Bob has been in the business for many years and he knows the products that people buy at different seasons. AI can go one step further by analyzing historical sales data. It can warn Bob that there seems to be a trend in which people started consuming turkey meat three weeks earlier every year. AI can target customers with relevant promotions, such as holiday turkey grilling packages or winter turkey stew specials.
Loyalty Programs: AI can personalize loyalty programs for Bob’s customers by offering tailored rewards based on customer preferences and purchase history. The customer has purchased something at the shop once every two weeks for three months in a row. The customer stops coming to the store for a month. AI will automatically send an email to the customer thanking him for his loyalty and offer a discount next time he comes to the store increasing the chances that the customer will return.
Inventory Management:
Demand Forecasting: For us in the Rio Grande Valley, this was a wet year. AI can analyze historical sales data and external factors like weather patterns to predict future demand, optimizing inventory levels and reducing food waste. If Bob was taking advantage of AI, he would have been warned that people may not bbq outside as much as they usually do. Bob could have offered cooked meats like chicharrones or carnitas for people to enjoy indoors.
Supply Chain Optimization: Bob hears from one of his suppliers that they will be running a special prize if he pre-orders three months in advance. Now, this could be a good savings for him, but after asking AI, he realizes that this supplier has been late with their deliveries consistently for as much as a week.AI can optimize the supply chain by identifying the most efficient suppliers and distribution routes, ensuring fresh and high-quality products.
Customer Service:
AI-Powered Chatbots: Bob has a company like ours integrate an AI-powered chatbot on his system. The customer calls the store and is surprised that someone picked up on the first or second ring. She wants to ask if Bob carries fish as well as meat in his store. The chatbot using a female voice answers and lets the customer know that someone will be picking up soon, but if she has a question, maybe “she” can answer it. The customer asks if Bob carries fish. The bot answers that, “Yes, we carry whatever fish is the best quality fish available in the market that is fresh and not frozen. Do you have another question that I can answer for you?” The point here is that the customer got the answer she needed without having to take time away from the staff and if trained properly, the customer didn’t even realize she was talking to a bot. If you are skeptical because you have called businesses before and you could tell you were talking to a robot, that’s because it was not AI. I bet that most everyone who has called a big box store has talked to AI and didn’t know it.
Personalized Customer Service: AI can analyze customer feedback and interactions to identify opportunities for improvement. If Bob has integrated AI in his systems, AI will learn from previous mistakes. If AI notices that a customer never interacts with the emails, it can let Bob know that it’s time to ask the customer if they have changed email address or if they prefer to be contacted by text or messenger.
I would like for small business owners to take away a few things from this article.
If we don’t start using AI as a tool to better our businesses, our competitors will because it is available for everyone.
Encouragement to take a look at our small businesses and think of ways that AI could help us save time, man hours and money.
Time is of the essence because it’s advancing very quickly and it will get harder and harder to break through the noise the longer we wait.
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ARTC Consulting
956-483-9557
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