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International Journal of Creative and Open Research in Engineering and Management

A Peer-Reviewed, Open-Access International Journal Supporting Multidisciplinary Research, Digital Publishing Standards, DOI Registration, and Academic Indexing.
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ISSN: 3108-1754 (Online)
Crossref DOI: Available
ISO Certification: 9001:2015
Publication Fee: 599/- INR
Compliance: UGC Journal Norms
License: CC BY 4.0
Peer Review: Double Blind
Volume 02, Issue 6

Published on: June 2026

THE IMPACT OF AI-POWERED CHATBOT PERFORMANCE ON CUSTOMER RETENTION: THE MEDIATING ROLE OF CUSTOMER SATISFACTION IN THE INDIAN RETAIL INDUSTRY

Varun N Gowda Varun C Shekhar

Dr. M. Rajesh

CMR Institute of Technology, Bengaluru
DOI:https://doi.org/10.55041/ijcope.v2i6.310

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Plagiarism Passed Peer Reviewed Open Access

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Abstract

The rapid digitalization of the Indian retail industry has accelerated the deployment of Artificial Intelligence (AI)-powered chatbots as primary customer service tools. This study investigates the influence of AI-powered chatbots on customer satisfaction and retention within the Indian retail context. Employing a quantitative research design with data collected from 84 respondents who had recent chatbot interactions on major Indian retail platforms, the study applies regression analysis, correlation analysis, and chi-square testing to examine the relationships between chatbot performance, customer satisfaction, and customer retention. Results indicate that chatbot performance significantly predicts customer satisfaction (R² = 0.58) and that together, chatbot performance and satisfaction explain 66% of the variance in customer retention (R² = 0.66). A strong positive correlation was observed between satisfaction and retention (r = 0.74), and a chi-square test confirmed a statistically significant association between chatbot experience quality and satisfaction (χ² = 16.48, p < 0.01). The study concludes that while AI chatbots substantially enhance service efficiency and loyalty when well-designed, limitations in emotional intelligence and linguistic adaptability remain barriers in India's diverse consumer market. Recommendations are provided for retailers, developers, and future researchers.

Keywords: AI chatbots, customer satisfaction, customer retention, Indian retail, natural language processing, digital transformation

How to Cite this Paper

Gowda, V. N. & Shekhar, V. C. (2026). The Impact of AI-Powered Chatbot Performance on Customer Retention: The Mediating Role of Customer Satisfaction in the Indian Retail Industry. International Journal of Creative and Open Research in Engineering and Management, <i>02</i>(6). https://doi.org/10.55041/ijcope.v2i6.310

Gowda, Varun, and Varun Shekhar. "The Impact of AI-Powered Chatbot Performance on Customer Retention: The Mediating Role of Customer Satisfaction in the Indian Retail Industry." International Journal of Creative and Open Research in Engineering and Management, vol. 02, no. 6, 2026, pp. . doi:https://doi.org/10.55041/ijcope.v2i6.310.

Gowda, Varun, and Varun Shekhar. "The Impact of AI-Powered Chatbot Performance on Customer Retention: The Mediating Role of Customer Satisfaction in the Indian Retail Industry." International Journal of Creative and Open Research in Engineering and Management 02, no. 6 (2026). https://doi.org/https://doi.org/10.55041/ijcope.v2i6.310.

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  • •Review follows editorial policy.
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  • •Peer Review Type: Double-Blind Peer Review
  • •Published on: Jun 24 2026
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