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The Digital Advantage for Small Businesses: How Digital Ads and AI Drive Growth

As small businesses navigate ongoing economic uncertainty, digital tools and artificial intelligence (AI) are helping them find customers, grow, and compete. Our new report, Digital Ads and AI Power Small Business Success, draws on survey data from 4,004 U.S. small- and medium-sized business (SMB) leaders to show that digital advertising and AI are vital to SMBs’ growth, efficiency, and success. As policymakers consider regulatory approaches, it’s crucial that they protect small businesses’ continued access to these tools.

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Background

Digital advertising and AI-powered technologies help small businesses connect with customers, cut costs, and save time — allowing them to grow and compete even amid broad economic uncertainty. Policies that weaken these tools, reduce access to them, or introduce burdensome new compliance obligations risk harming small businesses.

Lead Findings:

Digital Tools Are Essential for SMBs Navigating Economic Uncertainty

80% of SMB leaders say digital tools are important for running their business, including 36% who say they are “absolutely critical.”
63% of SMB leaders believe digital tools will play a critical role in helping their business navigate inflation and economic uncertainty in 2026.
53% of SMB leaders say AI tools are critical to the success of their business right now.
68% of SMB leaders say digital tools will play a critical role in their company’s growth and success over the next two years.

Digital Ads Help SMBs Reach Customers and Compete

72% of SMB leaders say their business buys and/or sells digital ads.
Among SMB leaders who use digital ads:
78% say the ads help them reach new customers.
75% say the ads help them compete with much larger competitors.
92% say they collect basic, non-sensitive customer data.
74% say their ads would be less effective if their digital partners could not collect or process basic data.

SMBs Are Enthusiastic About AI’s Potential

70% of SMB leaders have invested or plan to invest in AI training or AI adoption for their employees.
62% of SMB leaders say AI can level the competitive playing field.
53% of SMB leaders say AI tools are already critical to the success of their business.
62% of SMB leaders say they are excited about AI’s potential to help them grow their business.

The Bottom Line:

These findings underscore the importance of digital and AI-powered tools to small business success. Policymakers should strive for smart, balanced rules that protect consumers while ensuring small businesses’ access to the digital tools they need to grow, compete, and innovate.

Methodology

The Connected Commerce Council (3C) partnered with RXN to conduct an online survey of 4,004 leaders of U.S.-based small- and mid-sized businesses (SMBs; <500 FT employees) that sell products or services to businesses and/or consumers. State oversamples were also conducted in all 50 states. The main survey was conducted between November 7 and December 5, 2025, and the state oversamples were collected between November 7 and December 17. The main sample (N = 4,004) has a margin of error of +/-1.5%; the margin of error is larger for subgroups. The main survey was weighted to known census and SBA demographic variables, as well as to data from previous U.S. SMB research we conducted. Every survey respondent is an SMB leader involved in decisions that affect their entire business. The full results of the survey can be found here.