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Personalized Marketing with AI: Boon or Breach of Privacy?

Authors:

Mohammad Zaid, Student, Amity Business School, Amity University Chhattisgarh Prof. (Dr.) Annapurna Metta Sarjare, Assistant Director - Amity Business School Amity University Chhattisgarh, Raipur; sdave@rpr.amity.edu

AI-Powered Personalized Marketing and Consumer Privacy Perceptions: An Ethical Analysis

Introduction

In the digital era, businesses are increasingly harnessing Artificial Intelligence (AI) to enhance operational efficiency, improve decision-making, and most significantly, to transform marketing strategies. Among these innovations, personalized marketing powered by AI stands out as a revolutionary approach. It enables businesses to create uniquely tailored marketing messages, product suggestions, and advertisements based on detailed insights drawn from consumer data. AI algorithms analyze massive datasets—such as browsing patterns, past purchases, demographic information, geographic location, and even psychographic profiles—to predict and influence consumer behavior.

This hyper-targeted marketing model allows companies to reach their audiences with remarkable precision, improving both engagement and conversion rates. However, such capability does not come without challenges. The growing dependence on personal data for AI-driven personalization has raised significant ethical, legal, and social concerns regarding consumer privacy, consent, and autonomy. This paper aims to explore the underlying tension between the benefits of personalized marketing and the potential threats it poses to consumer privacy, providing a critical analysis of consumer perceptions and proposing a research-based framework to assess these concerns.