There's no dearth of technology to help deliver personalized content to Web sites and to deliver targeted promotions via e-mail. Users have plenty of choices, from the template-driven packages of BroadVision Inc. and Vignette Corp. to the more flexible development platforms of Art Technology Group Inc. and Blue Martini Software Inc. There are also site analysis tools, profiling systems, data analytics engines and collaborative filtering products. But analysts caution that software alone can't solve the personalization problem. Careful assessment of customer needs and business models are just as critical.

"Personalization is not something you buy out of a box," says Chris Selland, an analyst at The Yankee Group in Boston. "It's something you do."

The Children's Place:Outsource it!

The Children's Place Retail Stores Inc. knew it wanted to do one-to-one marketing with its online customers. But the Secaucus, N.J.-based retailer also knew it didn't have the in-house expertise to do it.

So the company sought outside help and found that, yes, even personalization can be outsourced. The Children's Place left it up to Net Perceptions Inc., a software vendor in Eden Prairie, Minn., to set up its collaborative filtering software with whatever partners needed to be involved.

Unlike some high-profile online retailers, The Children's Place outsources everything. Sunnyvale, Calif.-based Pandesic LLC handles the Web infrastructure. Boston-based Zefer Corp. does the Web design. Cambridge, Mass.-based Akamai Technologies Inc. delivers graphics. Minnetonka, Minn.-based Fingerhut Cos. handles fulfillment and customer service. Sunnyvale-based eGain Communications Corp. does the e-mail maintenance.

"We wanted to stay focused on what we do best: children's merchandis(ing) and (serving) our customers," says Debra Brummer, the company's director of e-commerce.

So her company leaves it to the Net Perceptions tool to study its customers' past and present buying behavior, both at its online and brick-and-mortar stores. Based on that buying behavior, a customer is sorted into a buying community filled with other shoppers who have established similar patterns. The more the customer shops, the more likely the tool's algorithms are to produce effective results. Or so the collaborative filtering theory goes.

"The reason why we're excited about collaborative filtering is because (the tool) learns in real time," Brummer says. "The engine gets smarter with every transaction."

Of course, there are skeptics. There's always the possibility, for instance, that a customer making a one-time gift purchase of fishing gear will receive prompts for rods and reels in the future, even if they aren't regular fishers. But Childrensplace.com asks customers if the item is a gift.

Brummer says her company has seen promising results since the site launched last November. When customers reach the virtual checkout counter, they're shown five items they might like to add to their shopping carts. Brummer declined to divulge the results, saying only that the company is "incredibly pleased."

The Children's Place also tried a small, targeted e-mail campaign based on Net Perceptions' recommendations. Hoping for 9% click-through, the company reached 19.1%, with 14.3% of those customers actually purchasing the suggested product. Brummer added that the

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