Small and Medium-sized Businesses (SMBs) in New Zealand are using AI to redefine their operations. This early adoption of AI has led to significant growth in New Zealand’s revenue. Their proactive approach has set them apart from international counterparts, leading to substantial revenue increases and enhanced productivity.
According to the Salesforce Small & Medium Business Trends Report 2024, 82% of New Zealand SMBs are testing AI tools. Of these, 95% have seen an increase in earnings, higher than the global average of 75% and the Asia-Pacific (APAC) average of 63%, thereby placing New Zealand SMBs at the forefront in growth.
Adrian Towsey, Area Vice President at Salesforce, stated that new SMBs embracing AI in Australia and New Zealand are experiencing advantages, such as enhanced operating margins and accelerated scaling.
The primary applications of AI among New Zealand SMBs include:
These applications improved efficiency of SMBs and provided an excellent customer experience, which helped in driving sales growth.
The economical benefits of adopting AI across various industries are clear. A recent study by Salesforce shows that 91% of SMBs that implemented AI experienced a revenue increase. It doesn't stop here, the AI Business Productivity Report also confirms this, explaining that 50% of organizations have experienced a positive financial effect of their AI investment. Additionally, efficiency gains have been tremendous, with an incredible 62% decrease in operational expenses.
A great example is Urban Rest, a flexible accommodation provider that has been able to successfully incorporate AI into its business. Urban Rest used Salesforce's AI features to revolutionize its customer relations team, achieving an amazing revenue increase of 1400% in three (3) years while reducing field service visits.
While AI adoption appears so promising, there are certain issues that cannot be ignored. In a Deloitte report of December 4, 2024, the importance of having effective governance mechanisms to control risks posed by AI technologies was highlighted. While the majority of SMB leaders express confidence about their capacity to overcome these issues, 74% of SMBs feel optimistic about their future with AI and 70% of them agree to face difficulties in keeping pace with fast-changing technologies.
However, less than 10% of companies have well established AI governance frameworks. This gap presents considerable risks as companies expand their AI initiatives without sufficient control. Addressing these governance issues is extremely important for continued growth and building trust among customers.
In the future, artificial intelligence holds tremendous potential for growth. Almost 80% of SMB leaders think that AI will be a game-changer for their organizations.
New Zealand SMBs should consider the following strategies to maximize the potential of AI while limiting risks:
Early AI adoption by SMBs in New Zealand is turning out to be a powerful source of revenue growth and operational efficiency. AI is clearly transforming small and medium-sized organizations, as a large number of companies are reporting positive financial returns on their investment. Those who invest early in AI capabilities will likely maintain a competitive edge over those who delay adoption.