Assessing the impact of Artificial Intelligence (AI) marketing adoption on the competitiveness and economic development of SMEs in Jaffna

Abstract

The pivotal role of small and medium-sized enterprises (SMEs) in fostering economic growth cannot be overstated, with these entities encompassing approximately 80% of all businesses in Sri Lanka. In the Jaffna region, SMEs significantly contribute to local economic performance. However, there is limited research on the specific advantages of AI marketing for SMEs in this locale. This study aims to assess how the integration of AI technologies in marketing practices enhances the growth and competitive edge of SMEs. The study employs a qualitative research design, utilizing purposive sampling to select eight SME owners and managers as participants. The study population consists of SMEs in the Jaffna region that have the potential for digital transformation. In-depth interviews were conducted to gather rich, contextual data. The data analysis process involved thematic analysis. The findings reveal that there is a general lack of awareness and understanding of AI marketing among SMEs in Jaffna, with many businesses continuing to use traditional methods. Challenges include inadequate digital infrastructure, limited access to AI tools, and a shortage of skilled personnel. Despite these obstacles, there is growing interest in adopting AI marketing to improve operational efficiency and market competitiveness. The study offers key insights for policymakers, business leaders, and technology providers in Jaffna, emphasizing the need for greater AI marketing awareness, education, and investments in digital infrastructure. Targeted support for SMEs will enhance their competitiveness and drive regional economic development. In conclusion, this research offers a comprehensive assessment of AI marketing's impact on SMEs in Sri Lanka, particularly in the underexplored context of Jaffna. The findings suggest that with proper support and resources, AI marketing can play a critical role in enhancing the growth and competitiveness of SMEs, thereby fostering regional economic development.