AI-Driven Personalization in E-Commerce: Impact on Customer Engagement and the Role of Privacy Concerns

Authors

  • Ratnawati Lang Institut Teknologi dan Bisnis Sabda Setia
  • Afni Eliana Saragih Institut Teknologi dan Bisnis Sabda Setia

DOI:

https://doi.org/10.29408/jpek.v9i2.30466

Keywords:

E-commerce, customer engagement, Artificial Intelegence

Abstract

This study addresses the gap in understanding the effects of different AI-driven personalization strategies on customer engagement in e-commerce, particularly considering the moderating role of privacy concerns. The purpose is to analyze how product recommendations, AI-driven customer service, and automated personalized promotions influence customer engagement, and how privacy concerns affect these relationships. A quantitative approach was applied using survey data collected from 258 e-commerce users. Data were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The results show that automated personalized promotions significantly enhance customer engagement, while product recommendations and AI-driven customer service do not have a significant impact. The findings suggest that privacy concerns play a critical role in moderating the effectiveness of AI personalization. This study contributes to e-commerce marketing strategies by highlighting the importance of privacy considerations and targeted personalized promotions to increase customer engagement. Future research should explore privacy concern mitigation and test findings across diverse e-commerce platforms.

References

Amil, Y., & Midaoui, E. (2024). The Impact of AI-Driven Personalization Tools on Privacy Concerns and Consumer Trust in E-commerce [Liege University]. https://lib.uliege.behttps://matheo.uliege.be

Celestin, M., Vasuki, M., Sujatha, S., & Dinesh Kumar, A. (2024). How Businesses Create Personalized Experiences To Boost Customer Retention: The Role Of Technology And Human Interactions In Customer Satisfaction. International Journal of Applied and Advanced Scientific Research (IJAASR) International Peer Reviewed-Refereed Research Journal, 9(2), 2456–3080. https://doi.org/10.5281/zenodo.13871854

Fihris Khalik, M., Mohammad, W., & Syahreffy Themba, O. (2023). The Influence of Service Personalization, Customer Satisfaction, and Customer Retention in the Telecommunications Industry on Data-Driven Marketing. West Science Information System and Technology, 01(02), 55–62.

Inavolu Mounika Sai. (2024). Exploring AI-Driven Customer Service: Evolution, Architectures, Opportunities, Challenges and Future Directions Sai Mounika Inavolu. International Journal for Multidisciplinary Research, 6. www.ijfmr.com

Ingriana, A., & Rolando, B. (2025). Revolutioning E-Commerce Investigating The Effectiveness Of Ai-Driven Personalization In Influencing Consumer Purchasing Behavior. Jurnal Ilmu Manajemen Dan Kewirausahaan, 1.

Kishen, R., Upadhyay, S., Jaimon, F., Suresh, S., Kozlova, N., Bozhuk, S., Bahauovna, A., & Barykin, S. Y. (2021). Prospects For Artificial Intelligence Implementation To Design Personalized Customer Engagement Strategies. Journal of Legal, Ethical and Regulatory Issues, 24(6), 2–18.

Mandagie, W. C., & Kristaung, R. (2025). Mandagie & .. (2025). Jurnal Manajemen Dan Pemasaran Jasa, 18(1), 35–58. https://doi.org/http://dx.doi.org/10.25105/jmpj.v18i1.21587

Mustafa Ayobami Raji, Hameedat Bukola Olodo, Timothy Tolulope Oke, Wilhelmina Afua Addy, Onyeka Chrisanctus Ofodile, & Adedoyin Tolulope Oyewole. (2024). E-commerce and consumer behavior: A review of AI-powered personalization and market trends. GSC Advanced Research and Reviews, 18(3), 066–077. https://doi.org/10.30574/gscarr.2024.18.3.0090

Nimbalkar, A. A., & Berad, A. T. (2021). The Increasing Importance Of Ai Applications In E-Commerce. Vidyabharati International Interdisciplinary Research Journal, 13(1), 388–391. www.viirj.org

Paliński, M., Jusypenko, B., & Hardy, W. (2025). Behind the screens. Privacy and advertising preferences in VoD —the role of privacy concerns, persuasion knowledge, and experience. Journal of Retailing and Consumer Services, 84. https://doi.org/10.1016/j.jretconser.2025.104233

Patil, D., Digital, H., Andheri, & India. (2024). Artificial intelligence in retail and e-commerce: Enhancing customer experience through personalization, predictive analytics, and real-time engagement 1 Dimple Patil. . . Predictive Analytics, And Real-Time Engagement.

Rahman, S. M., Carlson, J., Gudergan, S. P., Wetzels, M., & Grewal, D. (2025). How do omnichannel customer experiences affect customer engagement? Theory and empirical validation. Journal of Business Research, 189. https://doi.org/10.1016/j.jbusres.2025.115196

Saxena, C., & Thakur, P. (2024). Mediating role of trust and privacy concerns between web assurance mechanism and purchase intention of online products. Telematics and Informatics Reports, 16. https://doi.org/10.1016/j.teler.2024.100177

Zhang, X., Chen, A. L., Piao, X., Yu, M., Zhang, Y., & Zhang, L. (2024a). Is AI chatbot recommendation convincing customer? An analytical response based on the elaboration likelihood model. Acta Psychologica, 250. https://doi.org/10.1016/j.actpsy.2024.104501

Zhang, X., Chen, A. L., Piao, X., Yu, M., Zhang, Y., & Zhang, L. (2024b). Is AI chatbot recommendation convincing customer? An analytical response based on the elaboration likelihood model. Acta Psychologica, 250. https://doi.org/10.1016/j.actpsy.2024.104501

Downloads

Published

2025-08-02