THE IMPACT OF ARTIFICIAL INTELLIGENCE INNOVATION ON E-COMMERCE AND THEIR EFFECT ON BUSINESS PERFORMANCE

Artificial Intelligence (AI) applications within e-commerce platforms now function as a leading power to change business performance measurements across multiple dimensions. This study examines the effects that artificial intelligence technology has on e-commerce satisfaction as well as operational performance and security management. The study used descriptive methods that included quantitative and qualitative analysis to measure how AI affects commercial business success. Three hundred twenty eight people participated in this research where 220 were e-commerce professionals along with 108 regular customers who lived in Gujarat state of India. The research used purposive sampling together with convenience sampling as mixed sampling to acquire insights from operational and consumer groups. All study objectives yielded important outcomes based on the results obtained. The application of AI-driven personalization resulted in major positive effects on loyalty and satisfaction of customers. This statistical evidence proves how personalized recommendation systems create satisfied customers who demonstrate loyalty to the companies. AI automation tools bring about improved operation efficiency and reduced expenses to organizations. Tests confirmed that AI automation played an essential role by accounting for important components of performance enhancement through efficiency and cost reduction. The deployment of AI-based fraud detection tools improves both security levels while establishing higher customer trust in the platform. The systems analyzed demonstrate positive effects on security levels through their capability to maintain platform trust at higher levels. High values of R² for security and trust demonstrate the fundamental part AI plays in directing e-commerce development into the future. The research demonstrates how e-commerce AI developments optimize business processes and security measures to achieve better market success in e-commerce.