The Role of Artificial Intelligence in Shaping Consumer Behaviour: A Theoretical Perspective on Personalization, Purchase Intention, and Brand Loyalty in Digital Markets

RISHU FATHIMA K.P; T. KUMAR

The Role of Artificial Intelligence in Shaping Consumer Behaviour: A Theoretical Perspective on Personalization, Purchase Intention, and Brand Loyalty in Digital Markets

Author(s)	Ms. RISHU FATHIMA K.P, Dr. T. KUMAR
Country	India
Abstract	In the digital marketplace, there is an overarching theme of "personalization" which is being driven by AI tools, which are able to make product recommendations, ads, pricing and content delivery decisions to people in real time based on their preferences. The present article is a theoretical review of the impact of AI-powered personalization on consumer purchase intention and brand loyalty. The article builds on the Technology Acceptance Model, the Stimulus-Organism-Response framework, relationship marketing theory, and the personalization-privacy paradox, resulting in the integrated conceptual model of this study. The article integrates an AI-driven personalization conceptual model with the mediation of four factors: perceived relevance, trust, emotional engagement, and perceived intrusiveness between them and purchase intention and loyalty, based on the literature reviewed above. Through a review of recent empirical studies from e-commerce, social media, and digital advertising environments, the study reveals that personalization is consistently and predictably associated with positive consumer engagement and purchase intent when consumer perceptions are that personalization is beneficial, clear, and respectful of consumer autonomy, but with negative effects of reactance, privacy concern, and algorithmic aversion when consumer perceptions are of being intruded upon, or opacity of personalization. The study also explores differences in these impacts across generations and cultures, especially for Generation Z consumers, and the strategic and ethical challenges for brands aiming to foster sustainable loyalty through AI-driven personalization. The review suggests that the market potential of AI personalization depends on more than just its technical complexity, it's how well it is developed to maintain consumer trust and a sense of control.
Keywords	Artificial intelligence, Personalizatio, Purchase intention, Brand loyalty, Digital markets, Privacy paradox
Field	Business Administration
Published In	Volume 17, Issue 4, October-December 2026
Published On	2026-10-04

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The Role of Artificial Intelligence in Shaping Consumer Behaviour: A Theoretical Perspective on Personalization, Purchase Intention, and Brand Loyalty in Digital Markets

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