The Impact of Artificial Intelligence (AI) Replacement in Marketing - Integrating Contemporary Service Theories to Explore Stakeholder Dynamics

The rapid advancements in Artificial Intelligence (AI) in services enable companies to replace human labor with technology. Companies often adopt AI as a source of competitive advantage, forgetting about its potential detrimental impact on their employees and customers. This issue is particularly critical in the service industry, where human interaction is still highly valued. This thesis examines the impact of AI on different service stakeholders according to the Consumer–Autonomous Technology–Worker (CAW) framework and the Feeling Economy paradigm, targeting AI replacement and AI aversion in the service context, with the aim to understand the most relevant and the least jarring ways of AI integration. More specifically, a set of 12 studies, including sentiment analyses and experimental design approach, indicate that AI replacement has a negative influence on service employees but also is not perceived favorably by customers. For instance, the research demonstrates that companies’ self-promotion of AI-empowered resources (vs. human-centered resources) can reduce customers’ willingness to engage with service and can be perceived as exaggeration derived from amplified self-discrepancy. Then, the thesis reveals the negative impact of AI presence in the workplace, such as increased fear of being replaced and decreased performance due to employees’ self-comparison with AI abilities. Concurrently, customers express concern over employees being replaced by AI. Next, the research proposes an alternative to AI replacement — augmentation approach — which is perceived by customers as more enjoyable and easier to use, increasing the willingness to accept the service. Finally, the thesis provides important theoretical implications and informed practices, helping to mitigate AI’s negative outcomes on companies, employees, and customers.