Artificial intelligence and its impact on consumer behavior and marketing management

The evolution of artificial intelligence (AI) from algorithmic decision-making to the emergence of generative AI (GenAI) is the main subject of this article, which examines the substantial influence of AI on consumer behaviour. With a move from conventional predictive models to more modern generative models like transformers and diffusion models, it examines how AI’s predictive powers have affected consumer behaviour over the past 15 years. With AI-powered solutions enabling more efficient client segmentation, targeted marketing, and individualised customer service—all of which increase customer engagement and loyalty—the study emphasises the growing significance of AI in marketing. Nonetheless, issues like the absence of human engagement in AI-powered interactions and sporadic errors in AI forecasts are addressed. The study ends with a forward-looking assessment of AI’s potential, highlighting how it might transform marketing, alter consumer behaviour, and improve corporate brand management. With the help of this study, the paper suggests future topics of inquiry and highlights how companies must adjust to the quickly evolving AI-driven landscape in order to stay competitive.