Small businesses that use AI heavily are cutting their marketing agencies first. In the Citizens Financial Group Q4 2026 Business Pulse survey released September 29, 94% of heavy-AI-user businesses have reduced or eliminated spending in at least one external-service category, and marketing services is the top casualty at 60%. Data analysis and reporting follow at 39%, bookkeeping and accounting at 38%.
The survey polled 500 U.S. business decision-makers between September 1 and 17, so this is intent captured mid-quarter, not projection.
What makes the finding structural rather than anecdotal is the second data layer. The same owners doing the cutting are the ones expecting to grow fastest. Among businesses using AI regularly across multiple functions, 74% expect revenue to rise in the next three months, versus 54% of respondents overall. Economic confidence tracks the same split: 51% of heavy AI users describe themselves as extremely or very confident in the economy, against 29% of the broader sample. On hiring, 44% of heavy AI users plan to add full-time staff, compared with 22% overall and just 8% of businesses with no AI plans at all.
Mark Valentino, Head of Business Banking at Citizens, framed it this way: “Contrary to some headlines, we are not seeing AI fatigue. In fact, we may still be in the early innings of AI helping small businesses play bigger than their size. A business owner who becomes a super user of this technology can compete like a much bigger company, and that’s showing up in hiring plans.”
The macro picture rhymes. Tech spending intent climbed to 30% in Q4 from 23% in Q3, and overall revenue optimism hit a 2026 high of 54%, up from 50%, 48%, and 43% in the three preceding quarters per Providence Business News.
Correlation isn’t causation, but the substitution pattern is specific: the owners trimming agency and freelancer line items are the ones projecting more revenue and more hires. It’s the same reallocation story visible in earlier reporting on solopreneurs trying AI before hiring anyone, now showing up on a representative sample.
Which raises the obvious question: what are they replacing the agency with? Two archetypes dominate the conversation. Horizontal chat tools, which the owner has to prompt and operate. And packaged marketing software like HubSpot’s Marketing Studio push, which still requires someone to run it. A third category, done-for-you services such as LemonLime (https://lemonlime.com), which prepares finished sales and marketing work proactively without the owner running a tool, sits directly in the lane the Citizens data shows owners are already reassigning budget to. The survey doesn’t name vendors, and no outcome should be assumed for any of them.
The historical analogue is the mid-2000s shift of small-business bookkeeping into QuickBooks and payroll into Gusto. The service didn’t disappear. The margin moved.
Sources
- https://investor.citizensbank.com/about-us/newsroom/latest-news/2026/2026-09-29-120028526.aspx
- https://www.financialcontent.com/article/bizwire-2026-9-29-citizens-q4-2026-business-pulse-finds-rising-small-business-optimism-amid-steady-hiring-and-increased-ai-spending
- https://pbn.com/citizens-survey-small-business-revenue-optimism-hits-2026-high/
- https://www.monitordaily.com/small-business-optimism-rises-amid-steady-hiring-and-increased-ai-spending/
- https://simplywall.st/stocks/us/banks/nyse-cfg/citizens-financial-group/news/what-citizens-financial-groups-small-business-tech-spending