Ethical Challenges of Artificial Intelligence and Consumer Trust in Digital Marketing and Advertising

Authors

  • Prabhjeet Kaur Mittal School of Business, Lovely Professional University, Jalandhar, India. Author
  • Ramandeep Sandhu School of Computer Science and Engineering, Lovely Professional University, Jalandhar, India. Author
  • Deepika Ghai School of Electronics and Electrical Engineering, Lovely Professional University, Phagwara, India. Author

Keywords:

Consumer Trust, Artificial Intelligence (AI), Digital Marketing Ethics, Data Privacy, Online Advertising, Responsible Advertising

Abstract

The subsequent growth of data-driven technologies has not only fundamentally transformed the nature of the digital marketing and advertising industry, but also allowed firms to perform complex analyses of consumer behaviour as well as provide consumers with a great deal of personalization in their communication. Even though such practices help to improve efficacy of targeting and to increase consumer interest, another image is generated that creates serious issues with privacy, transparency, fairness, and control by the consumer. These ethical issues are very critical in defining the level of consumer trust an element that is critical towards the success and sustainability of digital advertising programs. The chapter provides a thorough review of the available body of literature on the ethical concerns of digital marketing and advertising data-driven and their effects on consumer loyalty. Bibliometric analysis was carried out using the studies, which were revealed in Scopus to examine the trend in publications, the journals that were predominant, the subject fields of discipline, the involvement of a specific country and the author activity. Examples indicate a significant increase in the research over the past years and the interdisciplinary nature of this field. Besides, the analysis indicates the growing academic production of the emerging economies with a concurrent high rate of publications in the advanced countries.  Data privacy, transparency, perceived intrusiveness, fairness and consumer control are the major ethical dimensions outlined in thematic review. Findings have shown that negative ethical perceptions damage consumer confidence which subsequently attracts to advertising avoidance and reduced engagement. On the other hand, trusted communication, accountable data management, and user controls enhance trust and achieve better advertisement results. Lastly, the chapter draws the conclusion that the management of consumer information in an ethical manner has turned into a strategic need of organisations. It is impossible to cultivate trust based on responsible and open-minded practice without maintaining positive relations with consumers and guaranteeing the continued effectiveness of digital marketing in more data-intensive settings.

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[1] Dutta, S., Ramanathan, A., Sakthi Prasath, G., & Edwin, T. (2025). AI-powered chatbots in Meta marketing (Facebook and Instagram): A game-changer for brand communication and engagement in e-commerce industries. Journal of Information Technology Teaching Cases, 20438869251338322. https://doi.org/10.1177/20438869251338322

[2] Ozkan, F. N. (2025). Recommendation Systems: Marketing Applications, Benefits and Risks. In F. I. Konyalıoğlu & F. S. Esen (Eds.), Multidisciplinary Approaches to Contemporary Marketing: Digital Trends, Social Issues and Economics (pp. 75-100). Springer Nature Switzerland. https://doi.org/10.1007/978-3-031-78026-4_3

[3] Tudor, C., Girlovan, A., & Botoroga, C.-A. (2025). Where Business Meets Location Intelligence: A Bibliometric Analysis of Geomarketing Research in Retail. ISPRS International Journal of Geo-Information, 14(8), 282.

[4] Pinto, G. P., & Prazeres, C. (2025). Data Privacy in the Internet of Things: A Perspective of Personal Data Store-Based Approaches. Journal of Cybersecurity and Privacy, 5(2), 25.

[5] Singh, T., Di Gangi, P. M., Johnston, A. C., Bott, G. J., & Lowry, P. B. (2026). Understanding the Influence of Data Breaches on Patients’ Willingness to Share Protected Health Information: A Mixed Methods Study of a Construals Privacy Calculus Perspective. Information Systems Frontiers. https://doi.org/10.1007/s10796-025-10690-3

[6] Feenstra, R. A., Carretero García, C., & Gómez Nicolau, E. (2025). Perception of Research Misconduct in a Spanish University. Journal of Academic Ethics, 23(1), 89-112. https://doi.org/10.1007/s10805-024-09526-7

[7] Oh, J., Nah, S., & Yang, Z. D. (2025). How Autonomy of Artificial Intelligence Technology and User Agency Influence AI Perceptions and Attitudes: Applying the Theory of Psychological Reactance. Journal of Broadcasting & Electronic Media, 69(3), 161-182. https://doi.org/10.1080/08838151.2025.2485319

[8] Shi, X., Wong, Y. D., Chai, C., & Li, M. Z. F. (2021). An Automated Machine Learning (AutoML) Method of Risk Prediction for Decision-Making of Autonomous Vehicles. IEEE Transactions on Intelligent Transportation Systems, 22(11), 7145-7154. https://doi.org/10.1109/TITS.2020.3002419

[9] Roberts, A., Hagan, A., Ravetta, E., & Kwon, R. (2025). Occupational Insecurity, Threat Perception, and Support for Exclusionary Immigration Policy in the Global North & South. Journal of International Migration and Integration. https://doi.org/10.1007/s12134-025-01322-5

[10] Schaeffer, M., & Kas, J. (2025). The integration paradox: Does awareness of the extent of ethno-racial discrimination increase reports of discrimination? Political Psychology, 46(3), 623-636. https://doi.org/https://doi.org/10.1111/pops.13027

[11] McKee, K., Dahl, A. J., & Peltier, J. W. (2025). Personalized digital marketing value-in-use: examining the influences on consumers’ continuum of interactive marketing avoidance behaviors. Journal of Research in Interactive Marketing, 1-18. https://doi.org/10.1108/JRIM-03-2025-0136

[12] Pahari, S., Bandyopadhyay, A., & Manna, A. (2024). Exploring the social media advertising avoidance behavior through the lens of avoidance motivation theory. Kybernetes, 54(13), 7209-7225. https://doi.org/10.1108/K-02-2024-0309

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Published

2026-09-30