The Role of Artificial Intelligence in Modern Retail and Digital Commerce

Abstract

Artificial Intelligence (AI) has become a key driver of transformation in modern retail and digital commerce, enabling businesses to shift toward data-driven and customer-centric models. This study examines the role of AI in enhancing customer engagement, optimising supply chain operations, and improving marketing efficiency. Based on a conceptual and descriptive approach using secondary data, the findings indicate that AI technologies such as machine learning and predictive analytics significantly improve personalisation, operational efficiency, and decision-making. However, challenges such as data privacy concerns, high implementation costs, and algorithmic bias remain critical. The study concludes that effective AI adoption requires a balance between technological innovation and ethical governance to ensure sustainable growth in digital commerce.