Why The Hearing Aid Industry Ignores Black Friday

Even as I get tired of all the hype about Black Friday, I wonder why the hearing aid industry is conspicuous by its absence on the biggest shopping day of the year in the U.S. Today is the big day, the day after the Thanksgiving holiday when shoppers flock to the malls as retailers cut their prices and offer the best price-cutting and one-day sales events of the year.

But while my email inbox is full of offers from every retailer and manufacturer I’ve had contact with in 2011, I haven’t heard a peep from the many hearing aid manufacturers and resellers that send me sales pitches on other days of the year.

But on reflection I realize it should be no surprise. Why? Because manufacturers only reduce prices and put their products on sale when demand is weak and there’s enough competition in their market to make them worry. A little price incentive, especially in the holiday selling season, can be a great way to win a point or two of market share in a hotly contested market.

But the hearing aid industry is more like an oligopoly. Each of the five or six major manufacturers has a comfortable market share, and price comparison shopping is a rarity. Instead, sales channels are limited mainly to audiologists and hearing-aid dispensers, each of whom often only carries one manufacturer’s product line. People shopping for hearing aids usually get a referral to a good audiologist, and if they engage and start the process of buying a hearing aid, they often simply stop shopping around.

Lack of price competition or active consumer product comparisons means the price reduction curve that we see in other industries, especially during slow economic times, is a lot less pronounced in the hearing aid business. Customers who can afford to buy hearing aids still pay many thousands of dollars, while those who can’t afford them spend what money they have looking for Black Friday deals on other less expensive goods.

I’m wondering if Black Friday in 2012 will be any different for the hearing aid industry. In 2011 we’ve seen a number of “over the counter” hearing aid manufacturers enter the market, including UnitedHealth Group insurance company’s hi HealthInnovations subsidiary. These vendors are bypassing the traditional audiology sales channel and selling direct to consumers over the internet. They are trying to reach the tens of millions of Americans with mild hearing loss that can be treated with open-fit hearing aids providing a modest degree of amplification. The new products are less expensive and easy to purchase.

Hearing aid industry groups and professional audiology groups are up in arms about the new competitors, saying that without a full hearing exam and professional fitting, hearing aids can often do more harm than good. But U.S. regulators, who several years ago gave a green light on the internet sale of Personal Sound Amplification Products (PSAPs) directly to consumers, may not be inclined to intervene.

So, don’t be surprised if on Black Friday 2012, your email inbox is full of offers not only from your favorite department stores, but also with offers from some new competitors in the staid old hearing aid industry.

Hearing Mojo Publishes Hearing Aid Comparison Chart With Data On Leading Global Manufacturers’ Flagship Hearing Aid Brands

Shopping for hearing aids and other assistive listening technologies can be confusing and intimidating. With our focus on products and technologies for hard-of-hearing consumers, Hearing Mojo has gathered a lot of information on the leading brands of hearing aids and other devices and technologies that are available. Now we’ve organized data on the flagship brands from the world’s six largest hearing aid manufacturers and presented it in our first hearing aid comparison chart.

While the hearing aid comparison chart is by no means an exhaustive list, it does give consumers shopping for hearing aids an idea of what high-end features and functions are available from the world’s leading hearing aid brands. It also provides estimated prices for the premium brand hearing aids. Most important, it offers multiple links to other Hearing Mojo articles about the hearing aid products and brands, and the companies behind them, as well as direct links to the manufacturers’ product web sites.

The only way hard-of-hearing consumers can assure themselves they will get products at appropriate prices that will help them the most is to do extensive research. The comparison of six of the best-known premium brands is a good place to start. They include Oticon Agil (William Demant Holding), Starkey Wi Series (Starkey Laboratories), Phonak Ambra (Sonova Holding), ReSound Alera (GN Store Nord), Widex Clear440 (Widex), and Siemens Motion (Siemens Hearing Instruments).

Just keep in mind that there are dozens of other manufacturers who offer high-quality hearing aids with comparable price/performance, and each listed company offers numerous other hearing aids at other price/performance levels as well. So look carefully at the information on the chart, visit the multiple links, then look beyond this short list if you are serious about buying hearing aids.

We would love reader feedback on this first hearing-aid comparison chart, as we expect to develop additional comparison charts on other types of hearing aids and assistive listening devices.

Opinion: Hearing Aid Pricing Should be More Transparent

The recent Consumer Reports survey of hearing-aid pricing and fitting practices highlighted a growing problem for the hearing-aid industry. Increasingly, consumers are starting to wonder why a few small digital components that can be purchased individually from wholesalers for tens of dollars each (digital signal processor, microphone, amplifier and software) end up in a set of hearing aids that can cost thousands of dollars. It’s time for more transparent pricing in the hearing-aid industry. Digital technologies are becoming standardized, and the cost of components continues to decline.

And there are good alternatives to the established brands now for cost-conscious, tech-savvy do-it-yourselfers: America Hears, which builds top-quality digital hearing aids and sells them online, programs them to your audiogram at the factory, sends you the software to make your own adjustments, and has licensed audiologists at the end of the phone to give you as much help as you need. All for under $1,000 a hearing aid. But most other comparable top-quality digital hearing aids still cost two to three times that much. Why? The answer is in the cost of the service required to get a custom fit. If you don’t dare do it yourself, a good audiologist truly is worth his or her weight in gold, especially if your hearing profile is complex. Getting a comfortable fit and programming assistance tuned to your audiogram usually requires multiple tries and is seemingly as much art as science. An audiologist who will stick with you through multiple adjustments is worth a significant mark-up. But it’s fair to question the value of the markup above and beyond the wholesale price of the basic hearing instrument components.

The hearing industry for the most part remains stuck in a very old distribution model which has restricted growth and shut off affordable options for a large segment of potential buyers in need of hearing assistance. Today most hearing aids are sold by audiologists who charge a single price for the hearing instrument and the service they provide. They give you a hearing test and fit you with hearing aids that meet your specific needs. Their invoice most often does not include line items for the cost of the hearing test, for the ear molds, for the hearing instrument, or for follow-up service. If it did, you would see there’s a lot of cost built into the time they put into helping you out. If you don’t need much help, they make a lot of money. If you are a difficult case requiring a lot of adjustments, they make less. This model worked well until recently. But now, digital technologies are making many more options available for people with different kinds of hearing loss. Open-fit designs mean many consumers don’t need an earmold fitting, and good digital amplification is making it possible for many people to get the hearing assistance they need from low-cost manufacturers selling direct, over the counter. One manufacturer, Songbird Hearing, is even offering disposable hearing aids that you can buy direct from their web site to address mild hearing loss, without a hearing test if you sign a medical waiver. Read more

Consumer Reports Survey Finds Resellers Routinely Double Wholesale Prices of Hearing Aids

A Consumer Reports Magazine investigation of hearing-aid sales and fitting practices found that resellers commonly mark up the prices of new hearing aids more than 100 percent over the wholesale prices paid to manufacturers. In a major report published in the magazine’s July issue, Consumer Reports editors followed a dozen hearing-impaired patients for 6 months as they shopped for and used hearing aids, lab-testing the features of 44 hearing aids. The magazine’s National Research Center also conducted a survey of 1,100 Americans who had bought a hearing aid in the last three years.

“Consumer Reports verified the wholesale price of several of the hearing aids tested, finding on average a markup of 117 percent,” the magazine said in a news release. “This means that there is room to bargain,” said Consumer Reports Senior Editor Tobie Stanger, who added that only 15 percent of survey participants negotiated for a lower price.

Consumer Reports also found that most hearing-aid purchasers they tracked got what it called “mediocre” fittings. “Two-thirds of the 48 aids purchased were misfit: They amplified too little or too much,” the news release said. However, even with substandard fittings, the survey indicated that the hearing-aid industry has started to overcome past problems with customer satisfaction by finally delivering hearing assistance that actually helps users hear better: 73 percent of the users who bought hearing aids were highly satisfied.

The prices of the hearing aids in the Consumer Reports investigation ranged from $1,800 to $6,800 per pair. Currently most hearing aids are sold by manufacturers to audiologists, who resell the products while providing essential services such as a hearing test, fitting, programming the amplification settings to match the patient’s unique hearing profile, and providing warranty repair service. Audiologists justify the mark-up over the manufacturers’ wholesale prices by providing service as part of a set price for the hearing aids.

Newsweek Hearing-Loss Cover Story: I Guess Half A Loaf Is Better Than None At All

While the Newsweek cover story this week is notable for the attention it gives to hearing loss as a major societal issue, it’s also notable for what it doesn’t cover. But at least the cover picture is worth a million words. Read more