Microsoft introduces first-party data solutions for retailers

Two days ago, on January 9, 2025, Microsoft Advertising introduced two commerce media innovations aimed at helping retailers generate additional revenue streams through their first-party data assets. The announcement marks a significant development in the retail media sector, as businesses seek ways to maximize the value of their customer data.

According to Betty Chung, Head of Curation, Retail Media at Microsoft Advertising, retailers previously had limited options for monetizing their first-party audience data beyond their e-commerce platforms. The new solutions address this limitation by enabling retailers to extend their reach to non-endemic advertisers.

The first solution, Curate for Commerce, provides retailers with a centralized platform to manage and monetize their first-party data assets. The platform enables retailers to create targeted advertising opportunities for brands outside their traditional market segments, while maintaining control over data usage and customer experience.

Technical implementation of Curate for Commerce requires minimal infrastructure investment from retailers. The platform operates through Microsoft Advertising's existing technology stack, handling deal operations and buyer relationships through a dedicated support team. This approach aims to reduce operational complexity for retailers who may lack the internal resources to develop and maintain such programs independently.

Microsoft's second innovation, Sponsored Promotions by Brands (SPB), introduces a cost-per-sale advertising model across Microsoft Edge, Bing, and participating retail websites. The system embeds promotional content at specific consumer touchpoints, creating what Microsoft describes as personalized, data-driven experiences.

Steve Bartholomew, Vice President of Digital Investment at Publicis, reported successful early results from the SPB beta program. His team exceeded initial sales targets while maintaining operational efficiency through the ability to manage multiple retailers within a single campaign structure.

The technical architecture of SPB integrates with retailers' existing e-commerce infrastructure, appearing in search results and product description pages. This integration method aims to maintain site performance while introducing new promotional content. The system's cost-per-sale model means advertisers only incur charges when consumers complete purchases of promoted products.

First-party data utilization has become increasingly important for retailers as traditional third-party data sources face growing limitations. Retailer first-party data typically demonstrates higher accuracy and reliability in customer information, making it particularly valuable for advertisers seeking to create targeted campaigns.

The current state of SPB remains in closed beta, with broader availability planned for later in 2025. Microsoft has not disclosed specific performance metrics from the beta program beyond testimonials from early participants.

For retailers considering implementation, the Curate for Commerce platform offers four primary functionalities:

1. Revenue generation through first-party data monetization
2. Minimal technical infrastructure requirements
3. Access to non-endemic advertiser relationships
4. Consolidated data and media management

Microsoft's expansion in retail media technology arrives as retailers face increasing pressure to develop new revenue streams while maintaining control over their customer data assets. The introduction of these platforms reflects broader industry trends toward more efficient utilization of first-party data resources.

The solutions aim to address specific operational challenges faced by retailers, including resource constraints and limited advertiser relationships. By providing dedicated support teams and managing advertiser relationships, the platforms seek to reduce the operational burden on retail partners.

Microsoft has positioned these innovations within their existing advertising infrastructure, leveraging their established relationships with both advertisers and retailers. This approach allows for integration with current Microsoft Advertising products while maintaining distinct functionalities for retail media applications.

Looking ahead, Microsoft plans to expand availability of both platforms throughout 2025, though specific timeline details remain undisclosed. The company continues to develop its retail media capabilities as part of its broader advertising technology portfolio.

Implementation of these solutions requires integration with Microsoft's advertising infrastructure, suggesting potential technical considerations for retailers currently using different advertising technology stacks. Microsoft has not publicly detailed specific integration requirements or compatibility considerations.

The monetization of first-party data through these platforms represents a significant development in retail media technology, offering retailers new options for generating value from their customer data assets while maintaining control over data usage and customer experience.