The AI tool landscape keeps evolving. Every month brings new options, improvements to existing tools, and features that were premium becoming standard.

Here’s my August 2025 update on what’s genuinely useful for small businesses in regional Victoria.

Writing and Communication Tools

Claude and ChatGPT Keep Improving

Both major AI assistants released significant updates this year. The differences are increasingly subtle, and both handle business communication tasks well.

What’s new: Better understanding of Australian context, improved accuracy for business and technical writing, more nuanced tone matching.

Practical use: Drafting emails, creating marketing copy, summarising documents, brainstorming. Both tools now handle these tasks at a level that genuinely saves time.

Cost: ChatGPT Plus is $30/month, Claude Pro is $30/month. Free tiers remain useful for occasional use.

Microsoft Copilot Integration

For businesses using Microsoft 365, Copilot integration has matured significantly.

What’s new: Copilot now works seamlessly within Word, Excel, Outlook, and PowerPoint. The early integration issues have largely been resolved.

Practical use: Summarise email threads, draft documents from bullet points, create presentations from outlines, analyse spreadsheet data in natural language.

Cost: $45/user/month on top of Microsoft 365. Expensive, but productivity gains are real for heavy Microsoft users.

Accounting and Finance Tools

AI in Xero and MYOB

Both platforms have embedded more AI features this year.

Xero: Improved automatic categorisation, smarter receipt matching, better reconciliation suggestions. The accuracy has improved noticeably.

MYOB: Similar improvements, plus AI-assisted reporting that explains variations and anomalies in plain language.

Practical impact: Less time on data entry and reconciliation. More accurate books without more effort.

Visual and Design Tools

Canva’s AI Features

Canva has integrated AI throughout its platform.

What’s new: Magic Design creates layouts from brief descriptions. Background removal is nearly instant and accurate. Text-to-image generation for custom graphics.

Practical use: Creating social media graphics, marketing materials, presentations without design skills.

Caution: AI-generated images still sometimes look artificial. Use for backgrounds and decorative elements; be careful with central imagery.

Image Generation Options

Midjourney, DALL-E, and others continue improving. For businesses needing custom imagery without stock photo licensing or photographer costs, these tools have become practical.

Best for: Product mockups, conceptual illustrations, social media variety.

Not for: Professional photography replacement, people images (uncanny valley problems persist), anything requiring accuracy.

Customer Service Tools

Chatbot Platforms

AI chatbots have improved dramatically. Tools like Intercom, Drift, and Tidio now handle complex customer queries reasonably well.

What’s new: Better context retention, more natural conversation flow, improved handoff to humans when needed.

Practical use: Website chat that actually helps customers, after-hours response, FAQ handling.

Caution: Still not ready to replace human service entirely. Best as first-line support with human escalation.

What’s Overhyped

Fully autonomous AI agents: The promise of AI that handles complete business processes independently remains oversold. Current tools augment human work; they don’t replace it.

Voice AI for phone systems: Still frustrating for callers. Human reception or simple menu systems remain superior for most businesses.

AI-generated video: Quality has improved but still looks artificial. Not ready for professional business use.

Recommendations

Start with writing tools if you haven’t already. The productivity gain from AI-assisted communication is immediate and significant.

Trial Microsoft Copilot if you’re a heavy Microsoft 365 user. The cost is high but the integration is genuinely useful.

Update your accounting software if you’re on old versions. The AI features in current releases save meaningful time.

Be skeptical of “AI-powered” claims from unfamiliar vendors. Many products use “AI” as marketing rather than genuine capability.

The pattern continues: AI tools are becoming embedded in software you already use rather than requiring separate applications. The best AI for small business is increasingly invisible—it just makes your existing tools work better.