Startup gives Walgreens beverage aisle a digital makeover
Walgreens is giving its freezer and refrigerator doors a digital makeover in a move that could bring in more ad revenue. The Internet-of-Things doors showcase what's inside, but also offer an opportunity for advertisers to display real-time ads in front of consumers.
The program, which is being rolled out to select stores across the country, recently arrived at a Walgreens drugstore in New York City's Union Square. Nearly a dozen coolers—including water, soda, beer and ice cream—now have digital screens as a result of the program run by Cooler Screens, a two-year-old Chicago startup.
On a recent weekday afternoon, the aisle was humming with the lunch rush. Most shoppers did a double-take at the animated offerings, before shrugging and opening the cooler to select their drink. "Smart idea," remarked one woman.
The New York pilot, which began Jan. 31, follows a two-store rollout three months ago in Chicago; a test is also underway in San Francisco and the initiative will expand to Bellevue, Washington as well, according to Arsen Avakian, founder and CEO of Cooler Screens who formerly ran Argo Tea. One of his partners and co-founders on the venture is Greg Wasson, former president and CEO of Walgreens.
Walgreens is not the first retailer to explore digital screen innovation in the brick-and-mortar realm. Sephora, Nordstrom and fashion designer Rebecca Minkoff all use screens to enhance the shopping experience at their stores. The Cooler Screens initiative is notable because it is primarily a vehicle for ad dollars versus a tool for shoppers to research items.
Food coolers were "fundamentally like 1950 and in need of reinvention," Avakian says, noting that such a renovation comes by way of Cooler Screens' "digital canvas."
Proximity sensors in the door can tell when a consumer is approaching, while cameras also see motion and measure emotion as they determine the best ads to serve. (Avakian was quick to note that no data is recorded or stored and all privacy is protected.)
Already, Cooler Screens has recruited 15 advertisers including Aquafina, Red Bull, Gatorade, Coca-Cola Co. and PepsiCo. Their animated ads appear between digital displays of drinks with prices; some displays include digital tags based on the weather outside, or events such as the Super Bowl.
"Every brand has the opportunity to show their product in the best possible way," says Avakian, noting that Cooler Screens is a digital alternative to the questionable content that could be served up with ads on digital platforms such as Google and Facebook. Advertising revenue is split with Walgreens on a sliding scale that varies depending on initial investment in the buildout per property.
Early survey results from shoppers are promising, Avakian says, noting that is in talks with other retailers and expects to announce expansion soon. According to the survey, which was conducted by Look Media at a store in Chicago over a one-month period, 84 percent of shoppers strongly agree that products in coolers seem more appealing, while 74 percent prefer the digital doors to the traditional cooler doors.
A spokesman from Walgreens did not respond to a request for comment about the initiative.