Exploring the Impact of <scp>AI</scp> ‐Driven Marketing Strategies on Customer Engagement and Loyalty in Pakistan's Online Shopping Sector

ABSTRACT This study examines the impact of AI‐enabled marketing strategies on customer satisfaction, engagement, loyalty, and advocacy in Pakistan's online shopping sector. Focusing on the post‐purchase phase, it investigates how AI‐driven activities such as uniqueness, telepresence, delegation, interactivity, personalization, and customer relationship management shape customer behaviors and organizational outcomes. Drawing on dual concern theory, which examines the balance between egoistic and altruistic motivations, the study employs PLS–SEM analysis on data from 426 online shoppers to assess the impact of these AI strategies on key customer outcomes. The findings reveal that AI‐driven marketing significantly enhances customer satisfaction, thereby improving customer engagement, loyalty, and advocacy. Furthermore, AI engagement fosters psychological rewards related to self‐identity and life meaning, thereby contributing to long‐term customer relationships. For executives and marketers in emerging markets, particularly Pakistan, the study underscores the need to integrate AI technologies to personalize the shopping experience and drive meaningful post‐purchase engagement. This not only strengthens customer satisfaction and loyalty but also cultivates sustainable brand advocacy. The research contributes to the literature by offering practical insights into AI‐driven customer engagement and by providing a deeper understanding of the psychological impact of AI marketing on customer behavior, with a focus on long‐term relational benefits.