Understanding Customer Engagement in Pakistan’s E-Commerce Industry through AI-Driven Personalization and AI-Powered Chatbots: A Moderated Serial Mediation Approach

Abstract

Present study examines the impact of AI-driven personalization and AI- powered chatbots on customer engagement within Pakistan e-commerce sector using a moderated serial mediation platform. Representation on the stimulus-organism response model, technology acceptance model and expectation confirmation theory, the research investigates how satisfaction and trust sequentially mediate the relationship between AI technologies and engagement, while digital competence and privacy concerns act as moderators. A quantitative, cross sectional design was employed, with data collected from 270 online customers and analyzed using SmartPLS. Findings reveal that both personalization and chatbots significantly enhance engagement directly and indirectly through satisfaction and trust. Digital competence strengths this relationship, whereas privacy concerns weaken the effect of personalization. The study provides empirical evidence from an emerging market, offering theoretical contributions and practical insights for businesses aiming to optimizing AI-driven customer engagement strategies.