Generative Artificial Intelligence in Marketing: The Invisible Danger of AI Hallucinations

This study explores the transformative impact of Generative Artificial Intelligence (GAI) on the marketing highlighting both its significant opportunities and inherent challenges. GAI enhances marketing strategies through automated content creation, personalized customer experiences, and advanced data analytics, thereby increasing efficiency and engagement. However, the phenomenon of AI hallucinations—where AI models produce realistic yet incorrect or misleading information—poses substantial risks, including damage to brand reputation, erosion of consumer trust, and potential legal ramifications. To mitigate the risks associated with AI hallucinations, the study proposes comprehensive risk management strategies that include technical solutions to detect and correct erroneous outputs, human oversight to ensure accuracy, and adherence to ethical and regulatory frameworks. By balancing the advantages of GAI with robust measures to address AI-generated inaccuracies, organizations can harness its full potential while safeguarding their brand integrity and maintaining trust with customers.