Zoho’s Dual Focus: Serving Small Business and Enterprise Through Product-Led Growth and AI Innovations

Zoho’s #SMZ25 conference in San Antonio in September 2025 served as a platform for deep dives into the company’s core strategy, offering insights beyond product launches. My discussion with Raju Vegesna, the company’s chief evangelist, revealed a long-term, deliberate approach to business software. The conversation touched upon Zoho’s product-led growth, its distinctive dual focus on small business and enterprise, and its competitive stance against much larger players.

Image Credit: Zoho Corporation Analyst Briefing

Zoho’s Product-Led Growth: Engineering Innovation and AI For Business Success

Raju Vegesna described Zoho’s user acquisition as “marketing through engineering.” This approach prioritizes product utility over traditional, expensive marketing campaigns. The idea is to attract users with valuable, often free, applications like Zoho Notebook, which then serve as an entry point into the broader Zoho ecosystem. This strategy is built on the belief that a good product will market itself through word of mouth and customer discovery, ultimately leading to a more sustainable, less costly acquisition model.

Providing services to businesses ranging from small to enterprise level

Zoho presented their approach to serving both small businesses and enterprises as rooted in a shared platform with a distinct user experience. While the underlying technology may be complex, the user-facing products are designed for simplicity, particularly for small businesses that lack an IT department. As a business grows, it can seamlessly transition from a simple tool to a more customizable, comprehensive suite with just a few clicks, without the need for a service consultant.

User Philosophy

Vegesna underscored that Zoho’s user philosophy is centered on providing “peace of mind.” The company aims to make its products so intuitive that users rarely need to contact customer support, much like with popular consumer products like the iPhone or Excel. This is part of a broader “futureproofing” strategy that ensures customers’ technology evolves with market trends, new regulations, and their own growth, all while remaining on a trusted, reliable platform.

Zoho’s Competitive Strategy in the Business Software Market

Zoho views its competition not just on features, but on overall strategic positioning. Vegesna noted that Zoho is on a “shortlist” with Google and Microsoft for comprehensive business software suites. He highlighted that Zoho’s entry point is from the business applications side (e.g. CRM and accounting) rather than the IT-focused workplace tools favored by competitors. He also pointed to a significant advantage in developing countries, where competitors are raising prices in the name of AI investments, making Zoho’s affordable pricing a key differentiator.

Zoho’s Invisible AI Strategy

Zoho’s AI philosophy is to embed artificial intelligence so seamlessly into its products that users receive help from it without even realizing it. Vegesna explained that the company invests in its own large language models (LLMs) to avoid relying on third-party vendors and to offer innovative capabilities. He offered examples like automated data extraction from receipts or the intelligent filtering of phishing emails. The goal is to solve a business problem rather than simply “throwing a bunch of buzzwords” at the customer. He also demonstrated Zia Hubs, which can structure unstructured data from video and audio to help users analyze things like sales calls or internal meetings.

Our Take

The leadership at Zoho has affirmed their commitment to safeguarding customer data privacy at multiple briefings. They have said that they will not use client information as training data for their AI models. This stance is rare in the industry and could lead to increased trust that businesses place in Zoho’s solutions.

Zoho incorporates AI features that work quietly in the background, such as automatically extracting information from documents or detecting phishing emails, so users benefit from advanced technology without having to interact with it directly. This invisible adoption means users enjoy the benefits of automation without needing to learn new tools or worry about exposure to untested algorithms. The company’s proprietary Zia LLM represents a major investment, and Zoho hopes that this strategy will deliver more enterprise-grade AI capabilities without the typical price hikes seen elsewhere in the market.

Looking forward, Zoho is positioning itself to empower organizations with sophisticated AI capabilities while maintaining affordable pricing. Their approach to automation, which enhances productivity for customers regardless of business size, may help them serve multiple markets.

In the competitive enterprise software landscape, Zoho’s challenge is to maintain visibility among enterprise buyers by continuing to demonstrate innovation, reliability, and value as its suite evolves. Enterprise purchasing enables organizations to begin with just one product across their entire business or even pilot it within a single group before wider rollout. This incremental approach allows IT leaders to meet needs without requiring a full-scale transformation up front.

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