This study examines the emerging role of hyper-personalization and data-driven marketing in marketing strategies evolving with the impact of digitalization. In contradistinction to conventional personalization methodologies, hyper-personalization is facilitated by sophisticated analytical techniques, including real-time data, artificial intelligence, and machine learning. In this context, the present study examines the concept of hyper-personalization, its application areas, algorithm-based decision-making processes, data security, and ethical issues with a holistic approach. The text incorporates sectoral applications through the use of examples such as Netflix, Amazon, Spotify, Trendyol, and Yemeksepeti, and it meticulously delineates the manner in which hyper-personalization engenders a transformative experience for the user. Furthermore, the text delves into the intricate dynamics of hyper-personalization, addressing its potential as a competitive advantage in the digital landscape. It also explores the ethical challenges that accompany this practice, including concerns such as data privacy, algorithmic biases, and transparency.