AI IN E-COMMERCE AND DIGITAL MARKETING

Artificial intelligence has become a transformative force in e-commerce and digital marketing, enabling firms to enhance customer experience, optimize operations, and improve strategic decision-making. AI-driven tools such as recommendation engines, chatbots, predictive analytics, and personalization algorithms have redefined customer engagement by delivering tailored content and seamless online interactions. These technologies also support businesses by automating routine tasks, increasing targeting accuracy, and strengthening data-driven marketing capabilities. This conceptual chapter examines the role of AI in reshaping e-commerce and digital marketing ecosystems, drawing from existing research across Scopus and Web of Science sources to construct an integrated understanding of technological, strategic, and consumer-related dimensions. The chapter highlights the mechanisms through which AI enhances personalization, customer retention, operational efficiency, and competitive advantage. It also outlines key challenges associated with AI adoption, including data privacy concerns, algorithmic bias, implementation complexity, and organizational readiness. The chapter concludes by emphasizing AI’s potential to significantly influence digital business models while offering meaningful insights for marketers, policymakers, and researchers. Future research directions focus on ethical AI design, cross-cultural customer behavior, and long-term impacts of AI-enabled digital transformation.