Today, recommendation engines have become more accessible for smaller webshops
A recommendation engine is a piece of software that recommends other products based on the webshop's previous history. This means that the more data the engine has to work with, the better it gets. Of course, if it has 100 orders, it doesn't have the same statistics to base its recommendations on as if it had 100,000 orders. So whether you should choose a recommendation engine or not probably depends on how many orders you have (if you have few orders, spend your money on getting more visitors to your store).
Most engines today can take a look at your historical transactions and base their recommendations on them. What they're really looking at is what others have bought. It can be something like how you often buy batteries for a smoke alarm, but it can also be much more nuanced, like if you bought a sweater from Tommy Hilfiger, you might be more likely to buy a different piece of clothing from the Gant brand than from a third brand. Their algorithm can calculate that.
When you have visitors viewing a product, the recommendation engine will show products that it thinks visitors are most likely to buy. In all likelihood, the engine is better at this than when you are linking "related products" yourself.
These recommendation engines have become more and more advanced in recent years. For example, they have also taken over the search function of some webshops. They are also used in the upsell stage and even in newsletters, where they can show the user the products they have recently viewed. So you basically send out different newsletters to your users based on which products they have seen.
We've been working with online marketing ourselves for decades. As the only shop system in the country, we have spoken multiple times at conferences such as Marketingcamp, SEOday, Shopcamp, Digital Marketing, E-commerce Manager, Ecommerce Day, Web Analytics Wednesday and many more.