Staff Standpoint | December 2016 Hearing Review

Karl Strom According to statistics generated by the Hearing Industries Association (HIA), Washington, DC, net unit hearing aid sales in the United States increased by 8.8% in the third quarter (Q3) of 2016 compared to the same period last year, and have increased by 9.6% overall through September (Figure 1). The third quarter gains come on the heels of nearly double-digit (10.1% and 9.7%) increases in the first two quarters of the year, and build on a relatively strong base of sales during the same period in 2015. Last year, hearing aid unit sales increased by 7.2% (full year).

The private sector experienced an 11.2% increase in unit sales during Q3, after strong sales increases of 10.8% and 12.8% in Q1 and Q2, respectively. This made for an 11.6% overall unit growth rate through September. In contrast, the VA experienced unit gains of only 0.4% in both Q2 and Q3, which followed a 5.3% increase during Q1—for a 2% overall increase over last year.

hearing aid sales growth 2016

Figure 1. Hearing aid net unit sales by quarter, with VA dispensing in red and private/commercial-sector dispensing in blue. Sales in the first three quarters of 2016 grew by 9.6% for the total market: 11.6% for the private sector and 2.0% for the VA. Source: HIA.

While the HIA statistics for private/commercial sector unit sales are strong, they come with some necessary caveats. First, these statistics include the sales at Costco and other mass retailers (but not Sam’s Club). Costco alone was estimated by Hearing Review to constitute about 11% of the US hearing aid market in 2015, and the retail giant’s sales may be growing at even higher rates than the estimated 20-25% clip of the past 6-7 years. Second, two significant hearing aid manufacturers, Intricon and Hansaton, started reporting unit sales to the HIA statistical program for the first time in January, and are almost certainly responsible for several percentage points in gains for the commercial market.

The numbers are still encouraging. Anecdotal evidence from conversations with dispensers point to favorable conditions for most practices, and larger distributors appear to be experiencing excellent unit sales growth. However, as noted in previous articles, average sales prices (ASP) are falling—and falling fairly dramatically for the economy/basic lines (by about 12% in just over 2 years), which are particularly under pressure from Big Box retailers and other sources. Thus, factoring in all of the above, the actual revenue gains for private practices are likely to be much lower than the 11.6% overall unit sales growth figure for the private sector.

RIC/RITE-style and wireless devices continue to gain in popularity. Through September, BTE hearing aids made up 81.1% of all sales in 2016, with RIC/RITE hearing aids (a subset of BTEs) now constituting 65.6% of all hearing aids dispensed. More than two-thirds (66.4%) of hearing aids sold in the private sector were RIC/RITEs, compared to 62.4% in the VA. Nearly 9 in 10 (87.8%) hearing aids contained wireless technology.

At its current pace of about 10% growth, the US hearing aid market should come in just shy of 3.7 million net units distributed by the end of 2016.

Happy Holidays! As 2016 comes to a close, the staff of The Hearing Review thanks our readers, advertisers, and contributors for their fantastic support and feedback. We wish you the very best of the Holiday Season.