Impact of AI Personalization Algorithms on Customer Trust and Data Privacy Compliance in the United States

Personalization algorithms that are being driven by artificial intelligence (AI) are becoming more implicit in digital platforms throughout the United States to impact consumer experiences through targeted advertising, recommendation, and custom content. Although this kind of personalization leads to the increase in user interaction and business success, it also aggravates the issue regarding customer trust and privacy laws. This study focuses on the effects of AI personalization algorithms on trust and perceived compliance with data privacy laws in the United States, the relationship between attitudes of consumers regarding data collection, tracking, transparency, and regulatory protection and their effect on trust outcomes. This study follows a quantitative approach with nationally representative survey data of Pew Research Center in 2023, which captures the perceptions of digital data practices, privacy risks, and institutional effectiveness of keeping personal information safe by U.S. consumers. The field of AI personalization is described indirectly by those consumer perceptions of data-driven practices that are the basis of the functioning of the personalization algorithms, such as tracking, profiling, and content delivery. Statistical tests, such as descriptive statistics, correlation test, and regression analysis, are used to test relations among personalization related data concerns, customer trust and privacy law effectiveness perceptions. The results show that perceived intrusiveness and fear of the visibility of personal data correlate with lower customer confidence in online services. high levels of the perceptions of data privacy compliance, transparency, and good regulatory protection have a substantial impact on trust and reduce the adverse response to the practice of personalization.This study adds to the expanding body of literature on AI governance by providing an empirical association of personalization practices and trust and compliance perception in the U.S. setting. Practical implications are offered to the organizations and policymakers who strive to strike the right balance between the advantages of personalization and ethical accountability and regulatory adherence in an ever-more data-driven digital world.