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Pinterest's New Feature Shows the Power of Personalization

With its "Personalized for You" section, the startup is getting in on the trend of providing content tailored to users' interests, and trying to generate the revenue to justify its massive funding.

Personalization is all the rage in e-commerce, so the news that Pinterest, the online scrapbooking tool, is testing a new section of its website called "Personalized for You" comes as no surprise. As TechCrunch reported Wednesday, the section displays content in categories such as fashion, food, or travel that users have indicated they're interested in through their activity on the site.

So far, Pinterest has offered the feature only to a handful of users, leaving open the question of whether it will be more widely available in the future. For the Palo Alto, California-based startup, personalization could represent the missing link in its business: revenue. Pinterest, which is used by one-fifth of adults in the U.S. who are online, has $564 million in funding from venture capitalists and a whole lot to prove.

Part of that strategy will be helping advertisers get their products or services discovered, Ben Silbermann, the company's 31-year-old founder, told The Wall Street Journal on Tuesday. "Different advertisers have different abilities to actually create an ad that works well for this medium," he said. "With every new media type, whether it was Google, where you have text ads, or Facebook, which is more social advertising, or folks like Twitter, it takes people time to figure out, hey, what's my voice in this medium?" 

Personalization might be just the ticket, it seems, although Pinterest isn't the first to hop on the bandwagon. On Thursday, AOL announced it had acquired personalization startup Gravity for $90 million in cash, in yet another sign such tailored technology could help marketers gain insights about consumers and present them with more relevant ads. 

Last updated: Jan 23, 2014

JILL KRASNY | Staff Writer

Jill Krasny is a staff writer for Inc. magazine, where she covers the intersection of entertainment and startups. Prior to Inc., she was a writer for MTV and Esquire and an editor at TheStreet. She is a graduate of the University of Southern California with a degree in communication. She lives in New York City.

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