The company wants to involve more people in advertising, but the reaction so far has been annoyance and confusion.
Retailers are eager to add new experiences to their physical stores. But many consumers aren’t keen on changing their habits – and they’re certainly not used to watching freezer ads.
“People really enjoy their routines. They’re not always looking for excitement,” said Julio Sevilla, an associate professor of marketing at the University of Georgia who studies consumer behavior.
Digital screens, he said, can add uncertainty and physical barriers to a simple and literally transparent process: reaching a glass refrigerator.
Sevilla doesn’t think consumers are looking for novelty when they visit a grocery store: “We all like walking into a supermarket and knowing exactly what we’re getting. I also know exactly where things are. For these kinds of utilitarian products, framework, people like their certainty and simplicity.”
“I hope we can one day expand into all parts of the store,” Cooler Screens co-founder and CEO Arsen Avakian said in an interview with CNN Business.
Currently, the startup has about 10,000 screens in stores, which are viewed by about 90 million consumers per month, according to the company. Avakian said the company aims to bring its digital displays to a wide range of retailers, including beauty, consumer electronics and home improvement.
A Walgreens spokesperson said in an email that Walgreens is “committed to exploring digital innovation in [an] efforts to provide new and different experiences to our customers.”
The spokesperson said the displays add value because they give customers relevant product information to help them decide what to buy, and that Walgreens is evaluating the pilot to decide whether it should expand further.
‘Moment of truth’
Cooler Screens CEO Avakian said he developed the concept after seeing customers in stores pull out their phones to find product information and reviews. Traditionally, in-store advertising was limited to options such as signs, promotions and prominent shelf placement. But Cooler Screens’ targeted digital ads are delivered at the “moment of truth,” Avakian said, just when consumers are deciding which product to take out of the refrigerator.
Brands can place ads spread across multiple freezers, ones that display product nutrition labels, or ads triggered by weather or time of day. An ice cream company might want to run ads when it’s hot outside, while a coffee brand might be rushed in the morning.
The setup aims to help stores generate high-margin advertising revenue to offset their low-margin retail business. Businesses pay Cooler Screens to run on-screen ads, and retailers get a cut.
“There’s a big movement in retail right now to create what’s called a ‘retail media network,’ which leverages all the ways brands can interact digitally with that retailer,” said Chris Walton, former Vice President of Target who runs the retail blog. Omnitalk.
“It was not a problem”
Cooler Screens claims that 90% of consumers surveyed prefer its digital screens to traditional refrigerators, and that the screens increase store sales. (Walgreens did not comment on this.)
Avakian insists the technology is “identity-blind” and protects consumer privacy. The freezers are equipped with front-facing sensors used to anonymously track shoppers interacting with the platform, while interior-facing cameras track product inventory.
Some customers expressed frustration with the experience. People don’t know whether to press screens or talk to them. The items on display do not always correspond to what is inside because the products are out of stock.
Henry Brewer, who recently encountered one of the digital screens at a Walgreens in Chicago, said the technology was “highly visible” and “intrusive”.
“You see ads literally everywhere and now I have to go see them on the cooler?” he said. “It doesn’t just seem necessary, and I think it’s a diversion for the consumer when it wasn’t an issue.”
For Avakian, it’s simply expected growing pains. Cooler Screens plans to educate customers on digital screens and launch features like voice recognition, so shoppers can ask questions about prices or item locations.
“It’s the future of retail and shopping,” Avakian said.