StromYear-end hearing instrument sales statistics for the year 2000 issued by the Hearing Industries Assn. (HIA) were in line with HR’s estimates (Jan. 2001 HR, p.14) that net unit sales in the U.S. would total 1.93 million— a 2% increase or about 38,800 more units than last year. Unfortunately, what’s hidden in that figure is the fact that sales to government agencies were 34,300 units greater in 2000 than in 1999. In other words, about 500 more hearing instruments were sold by the approximately 11,500 private dispensing offices in 2000 compared to 1999. By just about anyone’s standards, this news is disheartening when one considers that it was a time when the economy was as red-hot, the field’s products and educational level have never been higher, and other factors that have historically influenced the industry (e.g., press coverage, government interference) have been generally favorable.

Despite the poor unit sales, HR estimates that the average dispensing office saw gross sales revenues rise by about 12% in 2000 due to the higher proportion of DSP and programmable instruments being sold. HIA year-end figures for 2000 indicate that DSP instruments now comprise 20% of all hearing instrument net unit sales, while analog programmable and non-programmable instruments comprised 30% and 50% of the market respectively. That means, for the first time in industry history, programmable and DSP instruments accounted for more than half of the unit volume and 65-70% of the gross revenues of the average dispensing office.

How far will the high performance instrument trend take us? If you’re looking at this question from a European perspective, the temptation might be to answer “much higher.” Some estimates cite DSP and programmable market penetration in Norway, for example, at an astounding 85%. Other countries like Denmark and France have experienced high performance instrument market penetration of 60-65% and about 25% in Germany. These countries, of course, have universal health care coverage programs that pay, or partially pay, for hearing aids, arguably rendering all comparisons to the U.S. market as moot. However, it’s a pretty safe bet that we’ll continue to see stronger sales for DSP and programmable instruments in the near future.

It can be tempting to be a Pollyanna about some of the above numbers. The dispensing of better quality instruments should yield better satisfied consumers and, eventually, more people who see the benefits of amplification (as long as the cost is kept in line with the benefit). The flat unit volume gains of the last two years may be seen as an “adjustment period” where dispensing professionals are rapidly integrating the relatively new, high-tech instruments into their product mix, as well as into their overall small business strategy. However, the unfortunate reality is that the hearing industry still faces abysmal market penetration (around 20.4%) and a burgeoning senior population that needs hearing help.

In our March issue, the Hearing Review staff will look at the above hearing industry market numbers and associated trends in more detail. We would appreciate any information on how your office and area of the country are faring and why. As always, we look forward to your comments.

Karl Strom