AI-Powered CRM Systems and the Ethics of Data Use: Personalization Vs. Privacy

Citation: Sergei Berezin, "AI-Powered CRM Systems and the Ethics of Data Use: Personalization Vs. Privacy", Universal Library of Engineering Technology, Volume 02, Issue 03.

Copyright: This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

This paper will discuss some of the ethical dilemmas that arise from using artificial intelligence in CRM systems, with a particular emphasis on striking an appropriate balance between service personalization and data privacy protection. This study identifies the major risks, regulatory requirements, and technical solutions necessary to ensure the ethical application of AI in customer relationship management. With business increasingly based on information, 81% of Americans say there is a lack of clarity in information usage by companies; 68% are human-factor-related data breaches—the need for codes of conduct usage rises. The uniqueness of this study lies in its comprehensive examination of the technical, regulatory, and organizational dimensions involved in the Salesforce and Facebook cases. The methodological base includes a systematic review of 21 sources, comparative technology analysis, and standard compliance assessment. It has been discovered that AI algorithms based on historical data can be biased, for instance, in lending and targeting advertisements; therefore, these models need audits and corrections. Major findings underscore the need for a multi-layered approach to balancing personalization and privacy. This paper will serve data scientists, CRM developers, digital lawyers, and regulators who deal with AI ethics.

Keywords: Artificial Intelligence, CRM Systems, Data Privacy, GDPR, Algorithmic Bias, AI Transparency, Differential Privacy, Data Ethics, Data Minimization.

https://doi.org/10.70315/uloap.ulete.2025.0203019