Assessing the Effectiveness of AI-Personalised Recommendation Systems and Their Impact on Customer Engagement and Satisfaction: A Case Study of Jumia in Lagos, Nigeria

Abstract

This study critically examines the effectiveness of AI-driven personalised recommendation systems and their impact on consumer engagement and satisfaction within Jumia, a leading e-commerce platform in Lagos, Nigeria. AI-personalised recommendations have become an essential tool in digital marketing, improving customer experiences by tailoring product suggestions based on browsing behavior, purchase history, and user preferences. However, in emerging markets such as Nigeria, socio-economic disparities, digital literacy levels, cultural influences, and trust issues may affect how consumers interact with and perceive AI-powered recommendations. Given Lagos’ economic and technological landscape, this research seeks to assess whether AI recommendations effectively enhance consumer engagement and satisfaction or if local challenges limit their impact.

A mixed-method research approach was adopted, integrating quantitative survey data from 195 Jumia consumers and qualitative insights from open-ended responses. This approach provided a comprehensive understanding of how AI-driven recommendations influence consumer behavior. The survey focused on key variables such as engagement, trust, perceived effectiveness, purchasing decisions, and privacy concerns. The quantitative data was analyzed using descriptive statistics, correlation analysis, regression models, and hypothesis testing, while qualitative responses underwent thematic analysis to identify recurring patterns and consumer sentiments. This methodological approach ensured a balanced examination of both statistical trends and consumer perceptions, offering deeper insights into how AI personalisation functions in this unique market.

The findings reveal that AI recommendations positively influence consumer engagement and satisfaction, particularly among individuals with higher digital literacy and purchasing power. Consumers who frequently shop online and are comfortable with digital platforms tend to trust AI-driven recommendations more and engage with them actively. However, the research also highlights significant challenges in AI personalisation adoption. Many consumers express concerns over data privacy, algorithmic bias, and the transparency of AI decision-making. Lower-income consumers, in particular, perceive AI recommendations as less relevant, as they often suggest products beyond their financial reach, reducing engagement and trust in the system. Additionally, cultural factors play a role, with some consumers preferring word-of-mouth recommendations or traditional shopping methods over AI-generated suggestions. These findings suggest that while AI-driven personalisation has potential in emerging markets, its effectiveness is not universal and is influenced by multiple external factors.

The study concludes that while AI personalisation is a valuable tool for improving customer experience and engagement, its full potential in Nigeria remains untapped due to economic, technological, and cultural limitations. Businesses operating in emerging markets need to address consumer concerns about privacy, ensure algorithmic fairness, and enhance transparency in AI-driven recommendations to foster greater trust and adoption. AI recommendation systems should also incorporate economic sensitivity, tailoring suggestions to reflect consumer spending power and local market conditions rather than relying solely on global purchasing patterns.

This research contributes to the growing literature on AI personalisation in e-commerce, offering practical insights for businesses, digital marketers, and AI developers seeking to optimise AI-driven strategies in diverse and economically stratified markets. By implementing AI personalisation strategies that align with local consumer behaviors and expectations, businesses can drive greater customer satisfaction, improve engagement rates, and foster long-term consumer loyalty in the Nigerian e-commerce landscape.