How Q-comm & E-comm are delivering the AI marketing revolution

The explosion of quick commerce and e-commerce in India has not only transformed how consumers shop but also how businesses market their products. Central to this transformation is the integration of artificial intelligence (AI) into marketing and advertising strategies, allowing businesses to optimize personalization, predict trends, and enhance operational efficiency.

Globally, the use of AI in advertising and marketing is projected to surpass $107 billion by 2028, growing at a compound annual growth rate (CAGR) of 28%. In India, AI-driven marketing spending is on a rapid rise, fuelled by the growth of e-commerce and quick commerce, with estimates suggesting the market will exceed $3 billion by 2025.

Personalization has emerged as the cornerstone of AI-driven marketing. Meghna Apparao, Director of E-Commerce & Retail at Meta, explains, “Meta’s AI engines ensure the right products reach the right audience, whether it’s a festive gifting campaign for urban consumers or essentials for Tier Two and Tier Three towns.” This approach has led to 86% of quick commerce product discoveries occurring on Meta platforms , dramatically shortening the funnel from discovery to conversion.

AI’s predictive analytics capabilities are also changing the game. Pulkit Narayan, CEO of Dangle Ads, highlights their ability to forecast consumer behaviour. “AI tools analyse historical data to predict what customers are likely to purchase, when, and how. This allows marketers to create better-targeted strategies and allocate resources more efficiently.”

As India’s quick commerce market is expected to grow from $5.5 billion in 2023 to $20 billion by 2027, and the e-commerce market from $75 billion in 2022 to $120 billion by 2025, the importance of AI in driving marketing efficiency and customer engagement cannot be overstated.

Mihir Mehta, Managing Partner at 0101.Today, adds, “AI-driven platforms like 3rdi optimize ad performance across self-serve models such as Meta and Google , delivering up to a 15% reduction in CPA within the first week of deployment. This efficiency is especially crucial in an increasingly competitive market.”

Dynamic Pricing, Chatbots, and Conversational Marketing

AI’s versatility extends beyond advertising to include customer experience. Apparao points to Swiggy’s 2.3x improvement in engagement through AI-driven WhatsApp flows, where users receive personalised recommendations based on preferences, budgets, and occasions.

Narayan emphasises the importance of AI chatbots, saying, “These tools provide real-time support, recommend products, and even automate sales, creating smoother customer journeys and reducing human workloads.”

He also highlights the role of dynamic pricing, noting, “AI algorithms adjust pricing dynamically based on demand, competition, and customer behaviour, optimizing revenue generation during high-demand periods like Diwali and Valentine’s Day.”

Tier Two and Tier Three cities account for nearly 60% of new online shoppers, driven by increasing smartphone penetration and affordable internet. Messaging platforms also play a vital role, with 55% of users in these regions purchasing products through WhatsApp in the last year.

Addressing Costs and Accessibility of AI Tools

While large players such as Amazon, Flipkart, and Swiggy extensively use custom enterprise-grade AI solutions costing several lakhs annually, the affordability of SaaS models has democratised access for smaller players.

Initial costs for AI implementation can be high, covering technology infrastructure and maintenance. Mehta explains, “Smaller brands rely on affordable SaaS tools starting at Rs 2,000–5,000 per month, making AI-driven solutions accessible even for those with limited budgets. The key challenge is not cost but effective integration and training to maximize ROI.”

Narayan echoes this sentiment but acknowledges the high upfront costs for custom solutions, noting, “Initial investments can be a barrier for startups, but the long-term efficiency gains justify the expense. Scalable AI tools are now available to address these concerns.”

Self-Serve Models and the Road Ahead

The shift toward self-serve advertising models is another significant trend. While platforms like Amazon and Flipkart are leading the charge, Mehta predicts this model will soon become the industry standard. “Self-serve advertising will democratize access to advanced tools, making them available to brands of all sizes. Platforms like Blinkit and Swiggy Instamart are already embedding AI for targeted promotions and personalized recommendations.”

AI tools are reshaping the digital marketing landscape, offering unparalleled opportunities for precision, efficiency, and scale. Apparao sums it up best, saying, “AI is the invisible force behind this revolution. It’s not just about reaching more consumers — it’s about making every interaction more meaningful.”