Small and medium-sized business owners have grown skeptical of advertising sales pitches built on artificial intelligence, and the reason comes down to trust. According to Gordon Borrell, CEO and founder of Borrell Associates, local advertisers have gotten sharp enough to spot AI-generated content the moment it lands in their inbox.
Borrell Associates surveys these business owners regularly, and the firm’s latest findings suggest a widening gap between how media companies use AI internally and how their clients feel about it.
The assumption that SMBs are as immersed in AI as the media industry turns out to be wrong, according to Borrell.
“We’re all in the advertising and marketing business, in the small niche world that we live in, and we think, ‘Oh yeah, use it to make a headline, use it to write copy or do a summary of something,'” Borrell said. “And yeah, they’re using it for that. But it’s a remarkably small percentage. And they’re also not using it to any great extent right now for marketing and advertising recommendations.”
That gap shows up clearly in the numbers. 71% of respondents reported some familiarity with AI tools, but only about 36% said they’d used AI specifically for content creation.
Why the AI Red Flag Goes Up
Once advertisers suspect a sales rep is leaning on AI instead of expertise, the relationship sours fast. The tell isn’t subtle, either, since clients notice patterns like excessive wordiness or unnecessary formatting almost immediately.
“When someone — could be a colleague or could be somebody else — sends you something, you can flag it pretty quickly now if it’s something that’s AI-driven,” Borrell said. “It’s like, ‘Oh wow, okay.’ Number one, it’s too wordy, and number two, it has a lot of boldface words in it. So the advertisers have gotten to the point where they can flag it as well.”
Once that happens, the underlying worry shifts from technical to financial. Clients start asking pointed questions about what they’re actually paying for, and reps without solid answers lose credibility fast.
Best Practices for Media Sellers
The core issue isn’t AI use itself — it’s authenticity. Sales reps who treat AI output as finished work rather than raw material put themselves at risk, since advertisers expect genuine expertise from the person across the table.
“Use AI in a genuine way. It’s a research tool, and it’s probably one of the most powerful research tools we’ve ever come across,” Borrell said. “But also absorb the knowledge, know the knowledge, make it your own. Do what a researcher does and look for holes in it — not just embrace it and enhance it. AI is a happy intern. It just glibly goes out and finds stuff for you and throws slop on the table.”
Reps who skip that filtering step risk delivering exactly the kind of unverified pitch that costs them a client’s confidence. Once trust erodes that way, it’s difficult to win back.
“What often happens is people rush,” the Borrell Associates CEO shared. “It’s like a kid at dinner. They blurt out ‘The Tyrannosaurus Rex is actually not the largest dinosaur in the world!’ You want to rush to somebody with new information that you gained. Well, you better really have gained that information and researched it, because the advertisers are probably going to say, ‘How do you know that?’ And you’re dead in the water unless you’ve done your research. So just be a little more prepared than a fifth grader.”
Consequently, the winners in this environment will be reps who position themselves as trusted advisors rather than product peddlers. Local businesses aren’t rejecting AI outright — they’re rejecting laziness dressed up as insight.
Rising Anxiety, Rising Ad Budgets
Meanwhile, a separate trend has emerged around how local advertisers respond to economic uncertainty, and it runs counter to decades of historical pattern. Borrell Associates has tracked business sentiment through its business barometer survey for over 16 years, and the second-quarter 2026 results revealed a shift that first appeared during the pandemic and has now solidified.
“Typically, what has happened in economic cycles has been really clear: fear goes up that the economy might be tanking, and it happens a lot,” Borrell said. “Worries go up, and advertising spending goes down. They hold on to the money. It’s just a natural reaction.”
Historically, that pullback made intuitive sense to business owners protecting themselves from a downturn, even when it hurt their long-term visibility. Since COVID, though, that instinct has reversed. Rising anxiety about gas prices and inflation now correlates with increased ad spending rather than decreased spending, largely because owners learned firsthand that advertising through uncertainty kept customers walking through the door.
“They learned that when things are kind of scary, as they were during the pandemic — hey, if you advertise more, guess what? People come in the door,” Borrell said. “You create conversations with people, and they buy your stuff.”
That lesson reframed advertising in the minds of many owners, shifting it from a discretionary cost to a proven survival tool. Still, old habits die hard, and skepticism about advertising’s return on investment hasn’t fully disappeared.
“It’s fueled by the constant belief, which hasn’t changed, that half of my advertising works, and half of it doesn’t,” Borrell said. “Trouble is, I don’t know which half is which, right?”
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Garrett Searight is Barrett Media’s News Editor, which includes writing daily news stories, features, and opinion columns. He joined Barrett Media in 2022 after a decade leading several radio brands in several formats, as well as a 5-year stint working in local television. In addition to his work with Barrett Media, he is a radio and TV play-by-play broadcaster. Reach out to him at Garrett@BarrettMedia.com.