The bandwagon of the day is PERSONALIZATION. Everyone who is anyone is modifying position statements and priorities to be a world-class leader in it.

But before you launch your organization into “must have a proprietary personalization engine right now” panic mode, please consider the following:

1. Personalization – as a means to organize how you present content – is an optimization tactic, not a strategy. Your survival as business and your ability to effectively serve your customers might not depend on having absolutely the best, proprietary personalization engine in the galaxy. Personalization may not even make sense for you.

2. Personalization is most effective if you have thousands of “quality” content units for it to prioritize – the more the better. If you had the best personalization engine in the galaxy and it was only personalizing a hundred units of average content, there might be little to no optimization effect at all on your business (depending upon the media you are personalizing on). Think about the number and variety of content units Amazon is choosing from to create your personalized experience – how would you grade them? How does your relevant content database compare to that of Amazon?

3. “Freshness” of content also impacts the effectiveness of your personalization engine. Facebook, Pinterest, Instagram and select news/curation services have arguably the best personalization potential because their inventory of content is both vast and continously fresh. If they didn’t have both, they would never be able to sustain the frequency of consumer engagement that they do – with or without personalization. If you have or are trying to achieve frequent engagement, without either a vast or fresh inventory, the impact of personalization will be less impressive and possibly even detrimental to your brand. Online dating sites have this challenge if a new member logs in too frequently – satisfaction and engagement will decrease. This isn’t because their matching (or personalization) algorithm is bad, it’s because they don’t have enough continuously fresh inventory to sustain the value proposition. (Insert snarky comment about online dating here, if you wish.)

And here’s another thing about frequency – if you’re only going to rely on derived data (i.e. purchase or browse data or other insight proprietary to you), the more frequent the visits the better that data set is. If a consumer engages with you weekly, you can make conclusions about them with much greater confidence than if they only engaged with you quarterly – for example.

4. The personalization algorithm, by itself, is unlikely to ever be a point of sustainable competitive advantage for most companies – unless your proprietary algorithm is also pulling from a proprietary (meaning nobody else has anything like it) data set. In this age of “big data”, there are very few datasets that either exclusive or unique or can’t be modeled…and where those gaps exist, they are closing fast.

5. You can do a lot with common sense. It’s easy to get enamored with technology and hope that it is smarter than us humans – but the reality is, the more data we have and the more capable our technology becomes – the more we have to use our own human brains. For example, for a grocery retailer, common sense says that you should always feature your highest penetration, highest frequency products first (those items that nearly everyone buys, most frequently). If you have more than 100 of high penetration, high frequency content items to promote –super awesome for you – move forward to personalization! If you don’t, don’t worry about it just yet.

6. Don’t be afraid to outsource. If you determine that you do need personalization in your toolkit, don’t assume that you have to do it all in house in order for it to be proprietary. Your unique content inventory or powering data set may contribute more to a competitive advantage in personalization than the analytics. Plus, you’ll come up the learning curve faster… and these days, being a fast learner is really the only sustainable competitive advantage.

Personalization is a nifty tool, one of many you can use to drive your business or improve your consumer experience. Its impact on your business will depend on the size and freshness of your content pool and the uniqueness of the data behind it. Understand what personalization is, what makes it valuable (or not) … and invest accordingly.