AI and the Personalization of User Experience in E-Commerce: Theoretical Foundations, Challenges, and Development Prospects in Georgia

Abstract

In modern e-commerce, customer experience personalization has become one of the key factors for gaining a competitive
advantage. This paper discusses the use of Artificial Intelligence (AI) and Machine Learning (ML) in creating personalized digital
environments for consumers. The article reviews the main principles of recommender systems, ethical issues related to data
processing, and the influence of the “Segment of One” approach on customer retention and loyalty. The study analyzes the
development trends of the Georgian e-commerce market, the practices of local platforms such as Veli.store and Extra.ge, as well
as the challenges related to Natural Language Processing (NLP) for the Georgian language. The paper shows that the effectiveness
of personalized digital services in Georgia largely depends on high-quality data analytics and compliance with data protection
standards.