Website personalization is the process of creating a unique experience for a visitor based on all accessible information you can gather about them.
This helps you create an experience that is tailored to the specific needs, wants and expectations of the visitor.
In the analog world, "personalization" is the oldest trick in the book. A shop clerk in a clothing store does not treat every customer the same. They ask questions and act on every impression they perceive to make the store visitor feel at home.
This has been harder on the web this far, but 2020 is the year of personalization for a reason. It's now expected from the visitors perspective and it's fully possible to do with minimal resources.
To create a personalization you need to follow these steps:
Define an audience segment. For example; visitors that have been to URLs containing the word "dress" more than 3 times in the last 3 days. They should have also visited the checkout but didn't go all the way.
Create the unique experience. Now create the unique experience for this visitor. Maybe give a discount if the visitor buys 2 dresses, or inform the visitor about which products goes great with dresses!
Run the personalization. Run the experience directly, or A/B test it first to make sure it's viable!