Will Cooler Digital Screens Heat up CPG Sales? | Marketing Maestros | Blogs | ANA

Will Cooler Digital Screens Heat up CPG Sales?

April 17, 2019

By Michael J. McDermott

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Conventional retail stores still account for the lion's share of consumer purchases, just a bit more than 90 percent of total sales in Q4 2018, according to the latest figures from the U.S. Commerce Department. But e-commerce sales continue to grow at a much faster pace than brick-and-mortar sales: 12.1 percent vs. 3.1 percent, respectively, in the final quarter last year. This paradigm shift is worrying to conventional retailers, all the more so as the number of digital natives is estimated to have doubled in the U.S. and other developed nations throughout the past five years.

One recurring but seldom successfully executed response to this trend has been for conventional retailers to replicate some aspects of the digital experience that shoppers find most appealing.

For example, a recent study found that 79 percent of 3,000 global consumers surveyed believe brick-and-mortar retailers will not stay competitive unless they can provide a strong digital shopping experience within the next three years.

Now, a startup called Cooler Screens is looking to help retailers do just that. It promises to improve the brick-and-mortar customer experience while creating new opportunities for retailers and CPG brands alike.

Cooler Screens declined the ANA's request for an interview. However, the company describes its technology in a press release, while a pilot program in a handful of Walgreens stores has garnered some media coverage in the business press. Among the brand marketers reportedly participating in the test are Nestlé, MillerCoors, Heineken, Conagra, Coca-Cola, PepsiCo, and Red Bull.

Cooler Screens technology uses cameras, sensors, digital screens, and machine learning to turn a brick-and-mortar retailer's cooler and freezer doors into a network of smart displays that provide several functions (illustrated below).


Enhanced Product Presentation

The screens transform cooler doors into digital merchandising platforms that display aesthetically pleasing images of the products shelved behind them.

More important for brand marketers, the digital screens function as in-store billboards that can serve specifically targeted ads to individual shoppers in real time, at the point of purchase. Cameras and sensors can determine the approximate age and gender of shoppers standing in front of a door, but the network collects and stores only anonymous metadata, not any unique identifying information regarding individual shoppers.

The technology can also analyze behavioral responses and external signals, such as weather and special events, while its machine-learning algorithms can use that information to customize ads. Marketers also get access to analytics and data that enable real-time performance evaluation of ads served.

For retailers, Cooler Screens promises improved merchandising with fewer out-of-stocks and better planogram adherence, as well as a new source of revenue. The company reportedly says that ad revenue will be split with participating retailers on a sliding scale ranging from 25 to 75 percent, based on its initial investment in the buildout at each location.


Learning Opportunities for Brands and Retailers

Dale Traxler, VP of commerce solutions at Rightpoint, a tech-oriented customer experience agency, has been beating the drum for brick-and-mortar retailers to increase their digital footprint for years. "I've been telling a story around a use case of dynamic personalization within brick-and-mortar stores using digital signage and inputs from cameras, native apps, walking-pattern detectors, and other technology tools," he says. Doing so, he adds, presents a great opportunity for brick-and-mortar retailers to watch and learn where their traffic is, where customers pick up goods but don't buy them, and how often they return.

The concept of extending digital reach into the brick-and-mortar environment at the point of sale is attractive to brand marketers, especially in CPG categories like beverages and dairy because the "final mile" is critical, says Gene Tiernan, managing director of teamDigital, a digital marketing and promotions agency. Up to that point, driving intent to purchase can compel consumers, but they often get distracted at the shelf. Not only can the ability to extend digital reach right up to the point of purchase help mitigate drop-off, it can also create opportunities to influence shoppers to choose one marketer's brand over that of a competitor's.


Responding to Consumers' Digital Expectations

Given the ubiquity of mobile devices and digital technology, consumers have come to expect a certain level of visual impact and interactivity throughout their buying journey.

From a strategic marketing perspective, extending reach into the brick-and-mortar environment at the point of sale should generate opportunities for brands to leverage other marketing capabilities, and that improved integration can increase marketing ROI. One recent study found that a well-integrated and customized campaign boosts performance by 57 percent.

As the digital media ecosystem and shopper experience start to blur, brands are increasingly looking for solutions that connect pre-store media to in-store experiences, says Dan Richardson, director of Invention+, the media-as-creative practice at Mindshare, the global media and marketing services arm of GroupM/WPP. "Alcoholic beverages, for instance, could better consolidate media with market-specific promotions or sponsorships and be able to better connect those efforts to someone actually opening up the cooler and picking up their beer."

Brian Elles, director of product marketing, sight solutions, at Mood Media, which provides in-store music and media intended to elevate the customer experience, sees these types of technologies having applications for brand marketers in a wide range of retail settings.

Elles expects strong growth both in the retail/grocery vertical and in the industry as a whole, specifically in departmental digital signage and smart digital shelving screens in grocery aisle endcaps.

"In traditional retail, we see creative digital screens around new product display areas, entry/exit signage, and promotional or flash sales areas," Elles says. "Point of sale is more challenging on small form factor screens, as pricing and product details would be difficult to view. However, larger screens at the point of sale provide value in retail outlets by doing a better job of communicating and relating to the ever-evolving consumer."

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