Examining AI's impact on Customer Experience: Marketing Automation as a Mediator Among Egyptian Youth in Phygital Stores

Abstract

This study examines the mediating role of Marketing automation in the relationship between Artificial Intelligence (AI) and Customer Experience (CX) from the perspective of Egyptian youth in Phygital stores.Quantitative deductive research was used through convenience sampling. Four hundred and fifteen validonline responses from Egyptian youth aged 18–29 who engage with phygital stores through a crosssectional design. Data was analyzed using SPSS to test the proposed hypotheses including reliability analysis, correlation analysis, and mediation testing through SEM. The paper provides empirical insights indicating that AI positively affect CX. Additionally, Marketing automation partially mediates the relationship between AI on CX. In which findings highlight that while AI directly affects CX, its full potential when it is added to this relationship, marketing automation systems that change AI-driven data and capabilities into personalized, timely, andefficient customer interactions. The study offers marketers valuable insights for crafting superior customer experience tailored to Egyptian youth in phygital stores by understanding the underlying mechanism through marketing automation. It allows organizations to analyze and process enormous amounts of customers' information in real time, gaining actionable insights into customer behaviors, perceptions, and preferences. Further, the contextual emphasis on digitally literate Egyptian youth in an emerging phygital environment has managerial relevance for marketers and retailers seeking to optimize multichannel approaches in comparablemarkets, one of the first studies to empirically confirm the partial mediation effect.