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BusinessweekFeature Walgreens Replaced Fridge Doors With Smart Screens. It’s Now a $200 Million Fiasco A startup promised the pharmacy chain its high-tech coolers would track shoppers and spark an in-store ad revolution.

Illustration: Sean Dong for Bloomberg Businessweek

By Austin Carr January 16, 2025 at 2:00 AM PST

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Translate The refrigerated section at the flagship Walgreens on Chicago’s Magnificent Mile was glowing with frozen food and bottled drinks, but not for long. Where the fridge cases were previously lined with simple glass doors, there were door-size computer screens instead. These “smart doors” obscured shoppers’ view of the fridges’ actual contents, replacing them with virtual rows of the Gatorades, Bagel Bites and other goods it promised were inside. The digital displays had a distinct advantage over regular glass, at least for the retailer: ads. When proximity sensors detected passersby, the fridge doors started playing short videos hawking Doritos or urging customers to check out with Apple Pay. If this sounds disruptive—in the ordinary sense of the word, not Silicon Valley’s—that might have seemed a generous description in December 2023, when all the screens went blank.

At first, the outage didn’t arouse suspicion. These internet-connected fridge panels, developed by a Chicago startup called Cooler Screens Inc., frequently flickered, crashed or showed the wrong products. Every so often, they caught fire. But store managers were stuck with them. As part of a 10-year contract with Walgreens for a split of the ad revenue, Cooler Screens had installed 10,000 smart doors at hundreds of US locations like this one. It planned to install 35,000 more. By this point, Walgreens had already tried to pull out of the deal and get rid of the doors, blaming what it says was glitchy hardware and software. But Cooler Screens had temporarily prevented their removal the prior June by suing Walgreens for breach of contract, seeking $200 million and demanding its screens stay in place. Unreported until now is that over the ensuing months of legal battling, during which Walgreens had countersued for monetary damages, Cooler Screens Chief Executive Officer Arsen Avakian decided to try a different form of pushback.

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