Generative AI and Hyper-Personalization in Customer Experience: Empirical Evidence from Consumer Survey Data

Abstract

This study investigates how generative AI, including ChatGPT, reshapes customer-brand interaction in marketing, specifically focusing on the balance between personalization benefits and privacy concerns. Rapid advances in AI are revolutionizing digital communication and customer experience, raising ethical questions. Brands now use hyper-personalization, but consumer trust and data autonomy remain critical issues. Employing a quantitative approach, survey data were collected from 400 consumers engaged with AI-based marketing systems. Multiple regression and structural equation modeling were applied to assess relationships among perceived personalization, privacy concerns, trust, and brand engagement. Descriptive statistics and hypothesis testing quantified key trends. Findings indicate increased AI-driven personalization enhances customer engagement and satisfaction but heightens privacy fears. Consumer acceptance depends on transparency, consent, and control over personal data. Ethical design and responsible innovation are essential. Marketers and policymakers should foster transparency and empower users to sustain trust and balance innovation with consumer security.