Says Data Helps Solve Out-of-Stocks, Promotional Inefficiency, Wasted Energy.
Brands Get Closer to the ‘Moment of Truth.” Retailers Get New Revenue Stream.
Company Practices ‘Privacy by Design.’

Argo Tea Co-founder Arsen Avakian was struck by how often consumers in store aisles pulled out a cell phone while browsing a drink cooler. When he asked why, he learned they were researching brands to understand everything from ingredients to provenance. With a background in technology, Avakian had a lightbulb moment. Why not turn the drink cooler door into a giant cellphone screen? “Digitally augmenting physical space is what became the big idea,” he told BD in an interview. “These are existing surfaces that are already here in front of consumers. Let’s digitize this door.” Five years later, Cooler Screens, the company he founded from that idea, has placed more than 10,000 screens in 700 US retail locations, including at Walgreens, Kroger, CVS, GetGO, Circle K, and Chevron. Consumers get a neat display of products inside without having to open the door, as well as nutrition information, brand advertising, and offers for special pricing. “When you can give them that very basic impulse information right in that magical five seconds when they are making up their mind, that’s a game changer,” Avakian said. “The shopper feels more empowered.” For retailers, the screens generate new point-of-sale advertising revenue. Cooler Screens reach more than 94 million “viewers” per month, according to the company. So far, companies including Coca-Cola, PepsiCo, Red Bull, Monster Beverage, Fiji Water, and Molson Coors have advertised on the screens. Behind the scenes, the screens collect identity-blind data on consumer behavior that can be used to shape and optimize promotions and pricing, track shelf-level inventory in real time, and attract digital-savvy consumers to the store. Avakian said the screens lead to an average incremental same store sales lift of between 4% and 6% depending on the category. BD spoke with Avakian to find out how Cooler Screens works and what’s next for the company. 

DETAILS. Cooler Screens says the company offers the largest digital media platform for the retail environment in the world. The internet-connected smart-screens include high-resolution video and photography. Optical sensors track consumer movements, while internally facing cameras track products inside the cooler. “Just like when you click on a website, when you open a door, it’s like a click,” Avakian said. “When you grab the product, we know that you just grabbed the product.” The sensors also detect how long a consumer lingers. Advertisers can use the information real-time to serve up a pizza deal to someone buying a six-pack of beer, for example. “We can stitch together a data model that will trigger the content,” Avakian said. Cooler Screens also is rolling out QR codes that can be scanned to allow consumers to control a door screen remotely. “The fact that we can bring digital capabilities to connect with people, promote products, tell brand stories at the shelf, at the moment of truth in a store environment, that has never been done before,” Avakian said.

ENTREPRENEUR. Armenian-born Avakian co-founded Argo Tea as a Chicago café in 2003 and grew it into a chain of almost 30 stores. The company launched a bottled ready-to- drink tea, sold in store chains including Walgreens and Kwik Trip, that became the brand’s focus. Argo Tea was sold to Golden Fleece Beverages in 2020. That same year, Argo Tea experimented with Cooler Screens during a relaunch into Walgreens.

PRIVACY. Avakian said Cooler Screens practices “privacy by design.” The technology is “identity blind,” meaning sensors and internally facing cameras aren’t capable of capturing data that can be linked to an individual. “It’s not about lawyers telling me what I can or cannot do,” Avakian said. “This is about what my customers think is OK or is not OK. Even if it’s a mile close to being gray area, I want to stay away from it.” Attention to privacy is good for business, he added. “If I win their hearts and win their trust, they will give me access to their eyeballs so I can sell them the ads,” Avakian said.

CAPITAL COST. Cooler Screens offers varying funding models for retailers. In one, the retailer buys the equipment and Cooler Screens provides the software. The retailer then sells advertising and promotional media screen time to brands. In a second option, Cooler Screens sells the media time, splitting the revenue with the retailer based on what the retailer invested into the equipment. In a newer program, a brand can buy internet- connected checkout coolers and pay a software fee, which allows the brand to control media pushed to the screen, detect interloping products inside, and see when a cooler becomes inoperable.

RELEVANT ADVERTISING. When it comes to ads displayed on Cooler Screens, Avakian said he’s not interested in “a Geico insurance ad showing up on a Coca-Cola door,” adding, “We created this rule that it’s got to be contextually relevant for the consumer, which is good for the customer and good for the brand.” Still, the consumer will be the ultimate judge, he allowed. “If the consumer says, ‘I’m okay with a Geico ad,’ nobody is going to have a say here.’”

BRAND SAFE ENVIRONMENT. Avakian said a benefit of Cooler Screens compared to other online platforms is what he called a “brand safe environment.” That means there is no risk a brand’s ads will end up in proximity to questionable content. “If I want to have business with Kroger and Walgreens and Coke and Pepsi, their reputation is just as important for them as anything else,” Avakian said. “So, I’ve got to give them an environment for their marketing to feel confident.”

A/B TESTING. Brands and retailers can use the screens to test the effectiveness of various ads and promotions, so they can do more of what works, Avakian said. “You want a pink ad, blue ad, yellow ad,” he said. “You want this promo, or the other promo. You want a Chinatown version. You want a Greektown version.” The testing also can reveal that a brand is leaving money on the table by offering a discount on a product a consumer was going to buy anyway, Avakian said.

DYNAMIC PRICING. Using a smartphone app, a store operator can change pricing at will to respond to market conditions. Or a module can be installed to implement dynamic pricing based on the retailer’s parameters. Cooler Screens can also use artificial intelligence to put surge pricing in place. Avakian said the technology gives brick-and-mortar retailers the same real-time capability as online retailers.

OUT OF STOCKS. Cooler Screen’s sensors can detect out of stocks in real time at the shelf level, which can reveal inventory misalignments. “You could be out on the shelf but have 10 cases in the backroom,” Avakian said. “That data is hugely valuable to retailers and to brands.” Screen time can provide competitive advantages as well.

CLOSING THE DOOR. There is a potential sustainability benefit to Cooler Screens, Avakian said. A typical consumer holds a traditional cooler door open for five to seven seconds on average while selecting a beverage, he said. Cooler Screens reduces that “open-close cycle” to about 1.5 seconds. The company is conducting a year-long study to measure the energy savings because of that quicker open-close cycle.

C-STORE PUSH. Avakian said a growth focus for Cooler Screens is the convenience and gas channel. One thing Avakian’s team learned during the pandemic is that consumers can get frustrated when they see neatly planogrammed product displays on a cooler screen, then out-of-stocks and disorganization behind the door. Coolers Screens is working on technology that would recognize labels and specific SKUs, so the screens can represent the real world inside the cooler for store owners, such as independents, who want to plug other products into holes to get it cold and sold. Of course, the product inside can still be depicted in a more organized way, Avakian said. “I want to give them a choice,” he said. “If 7-Eleven wants to force it on a franchisee to do it a certain way, it’s their decision. If they want to give them flexibility because the supply chain is stressed and they want to put what they get that day from DSD on the shelf, the screen needs to reflect that.” Avakian is also looking to the future when electric vehicles turn very short trips inside the store to longer trips as the car charges. His screens can give consumers something to do, which would give brands more time to deliver messaging and promotions.