Most small business owners have no clue if their marketing is working. That isn’t stopping them from spending more on it

Small businesses are committing more money to marketing this year than last, but surprisingly few have any confidence that their investment is paying off—even as more report using new tools like artificial intelligence to help boost their efforts.

The latest State of Small Business Marketing report from Constant Contact finds that just 18% of small business owners are “very confident” that their marketing is effective, down from 27% in 2024. That’s despite the fact that 37% of the more than 2,500 businesses surveyed said they had increased their marketing budgets for the year.

Small businesses feel optimistic—and under pressure

“Small businesses are under real pressure to see positive results from their marketing, but many feel like they are doing more without getting more back,” said Smita Wadhawan, chief marketing officer at Constant Contact, in a statement.

Overall, the report found that the majority of small business owners in the U.S. are most likely to say they are “not confident at all” that their marketing efforts are producing results.

The findings stands somewhat in contrast to the most recent NFIB Small Business Optimism Index: It found that small business sentiment in the country increased last month, with many owners expecting positive business conditions and opportunities in the coming months.

AI may be case for optimism

Those using AI may be faring slightly better when it comes to their marketing, however: The report found that nearly half of all the small businesses in the study are using AI to some extent in their marketing efforts, including using the tech to help with copywriting, emails, and creating visual content for social media feeds.

And while some 50% of small businesses in the U.K. and Australia and New Zealand are deploying AI, only 37% of U.S.-based firms are—the lowest percentage of any country polled in the report.

That finding syncs with other reports into how American businesses are using AI—or perhaps more accurately, not using it.

The U.S. Chamber of Commerce Technology Engagement Center (C_TEC) recently released a report that found 44% of small businesses in the U.S. used generative AI in some fashion. Tech and financial services companies, unsurprisingly, had the highest levels of adoption.

How to bridge the confidence gap

So why aren’t more firms using AI to help reach more customers? Some possible explanations for the low adoption rate are a lack of expertise or guidance in using the tools, or a failure to see how, exactly, AI might be useful in a given setting or organization.

Yet interest in AI and spending more on it to help with marketing is only set to grow among small business owners, despite the confidence gap.

Small business owners “are working harder than ever,” said Wadhawan, “but without the time, expertise, or data to guide them, many are still guessing about what will resonate with their customers.”