14 AUDIOLOGY PRACTICES n VOL. 5, NO. 4 by Terry Mactaggart , MBA enable the Tribe and Speed the Journey Amid Turbulent Change AUDIOLOGY PRACTICES n VOL. 5, NO. 4 15
I’M WRITING THIS ARTICLE as an outlier in the hearing instrument industry – someone who has been involved with the development of better hearing testing and assessment technologies for years, but not directly with hands-on dispensing. As an investor, director and CEO of a number of technology based enterprises, however, as well as a student of management and change, I’ve developed perspective that readers hopefully will find timely. My message is urgent and, from what I can tell, not sufficiently understood by or shared among enough industry participants.
Above all, I’m still puzzled. How an industry can avoid assisting millions of people with hearing loss who are accessible, but remain untreated is a mystery that one would have to look very hard elsewhere to replicate. Likewise, how (according to industry metrics) those treated per practitioner fall far below the number typically examined by most if not all other allied health professionals. True, margins on instruments and service remain relatively high allowing life style businesses to continue to operate with fairly low volumes. True also that some patients require extensive workups and coaching and all that takes more time and resources. And there remains that well known stigma, thus reluctance, among many with hearing loss about doing much about their condition.
We’ve characterized our business at Ultimate Kiosk as finding ways to “Enable the Tribe and Speed the Journey”. I respectively suggest that that’s an appropriate mission for our hearing health industry as a whole. Let’s start with listing some of the forces that are and will increasingly impact us – the usual “transformational” suspects one hears about and experiences in day to day living...
Several are described frequently in the literature and popular press. Three favorites of mine are listed below.
|1. THE MOBILE INTERNET||Not just the Net itself but the proliferation of wireless devices (“the Internet of Things”) that are and will become increasingly commonplace. The McKinsey Global Institute summarized this recently as “The Ubiquitous connectivity and an explosive proliferation of apps that are enabling users to go about their daily routines with new ways of knowing, perceiving and even interacting with the physical world.” We all use them and have some understanding of how clever, powerful and disruptive they can be.|
|2. SELF TRACKING||
Referring to “Quantified Selfers” who use phones, gadgets and apps to record things like sleep, air quality, food intake, exercise, stress levels, heart rate and mood. But it’s much more than that as this combination of technologies and habits empower individuals to study, understand and take greater charge of their personal well being as well as to share that knowledge with others. This phenomenon is an important aspect of what Brian Taylor refers to as “The Creative Destruction of Healthcare” which includes substituting the patient for the doctor (or health professional) on top of the pyramid and flattening it considerably.
A good grip on this can be gained by visiting http://medicinex.stanford.edu/. This forum represents an important medium and meeting place for the communities mobilizing to revolutionize healthcare. I was staggered when I attended their annual conference last fall – 100’s of participants from around the globe (patients, doctors and other professionals, researchers, Non-governmental organizations (NGOs), business people) who described their states of the art, how they track, congregate and learn (thus becoming connected “e-patients,” influencers and professionals) as well as push traditional institutions and methods towards much more patient-centric models. Thus the rise of “The Tribes” for over 30 chronic conditions cum disease arenas.
Big reveal – While interests like obesity, diabetes, cancer, arthritis and many others were present there and obviously active in virtual community building, hearing was not. I was it! And, when I described the size of our potential Tribe (those with hearing loss and their influencers), everyone was shocked at the oversight!
|3. I'M OK... AND SO ARE YOU||
also known as “the Healthy Aging Movement” (Taylor again) or more colloquially “The new 70 is really 50!” Every indicator suggests that Prebs and Boomers more often than not are refusing to quit. And most hate being “Patients.” Lifestyle considerations rule and dictate many of the choices they make. Cool products that support this aspiration, and are priced and presented effectively, do well. Those that don’t, frequently fail.
Connecting the dots and brainstorming the implications of these and other significant forces should be relatively straight forward – and yet, with some exceptions, are not commonly discussed among those of us connected to the industry. Forget about progress in curing some forms of hearing loss (at Stanford Medical and elsewhere), which could be argued as a medium-term threat. What about an i-Phone app that was shown to be equal in performance to an entry level hearing instrument? When I learned of that research at the recent AAA Conference (see Amlani’s article in this issue of AP for a summary of this research) and later reviewed the findings, I wasn’t particularly surprised. What did surprise and concern me appeared to be silence from audiologists attending the same conference.
Close your eyes and imagine 2015 – just over the horizon. Think Apple, Google and others, including companies we have never heard of. Do over 40 million consumers with hearing loss in the United States and Canada alone who are accessible yet untreated represent an attractive market? You bet they do. And it’s pretty certain that they’ll respond to propositions that alleviate that condition providing the products are well marketed, attractively priced, readily available and easy to use. It’s more about consumer electronics than medical devices. The age of the PSAP is emerging, like it or not.
I don’t for a moment discount the care in treatment that most hearing health professionals provide their patients. Accurate diagnosis, effective fitting and competent follow-up is important for many, particularly those who are older and/or not routine cases. They warrant respectful “patient” status and first class white coat treatment.
What I am perplexed about, however, is what is not being done to cultivate a new class of patients – typically younger and savvier about devices, costs and performance who experience lesser hearing losses. How to access if not “Increase this Tribe” and, for sure, “Speed their Journey” are strategic issues for the industry and, I argue, fundamental questions to answer and act upon, not simply ponder.
I’m not by nature alarmist. We’ve lived through a number of revolutions and come out the other side. But there is a compelling case to be made that the hearing health industry is presently a target and, if not more agile and adaptive, will be disrupted significantly in fewer years than one can count on one’s hand.
So here’s the concern. Let’s not let this industry go the way that music did with the advent of Napster and file sharing; or the book industry with the rise of Amazon; or the broadcast, banking or home video industries.
|How disruptive was peer-peer file sharing to the music industry? So disruptive it cost the industry $55 billion in revenue according to major labels. Since the rise and eventual fall of Napster, the music industry has adjusted however. Digital record sales continue to rise - in fact digital record sales accounted for $5.2 billion in 2011, a 5% growth from 2010. Peer-peer file sharing and music piracy still exists, but is not nearly the threat it once was to the industry.|
|Unlike the music industry the home video industry hasn’t survived. What Napster was to major record labels, Netflix was to home video vendors. In the 90’s some argued that Blockbuster was “Too big to fail”. During that time Blockbuster grew from 19 stores to nearly 1,300 and accounted for $10 billion in annual revenue. So what happened? Pay-per-view video on- demand systems and carriers saw a market opportunity and capitalized. What was Blockbuster’s reaction to the suggestion that change was occurring? Its CEO scoffed at suggestions that new pay-per-view and video-on-demand systems, then in development, would sound the death knell for the home video industry. History has since proved otherwise. In September 2010 the death knell tolled when Blockbuster, founded in 1985, filed for bankruptcy.|
These case histories of turbulence and disruptive change are revealing. The equivalent for hearing health would imply greater demand from a much wider demographic, served by a greater selection of assistive devices offered at lower price points and available through additional channels – pharmacy, optical and medical being obvious and already underway. Will much of dispensing – the way we presently know it - go the way of the independent bookseller?
Some might argue that significant challenges have been faced down by the industry before and likely will be again. Calculate your own probability estimate about prospects for quiet passage. Mine converges on slim to zero.
Surely this notion of quite profound change afoot is not heretical – thankfully it’s beginning to appear in the literature, message boards and conferences – but it does lead to some fundamental questions.
Where do we go from here? How might we prepare? Mount both an offense and defense? More specifically....
1. How should issues of hearing, hearing health and loss be framed and communicated today?
2. What Value Proposition should participants in the industry adopt?
3. How should we flow with (and benefit from) rather than fight (or push aside) inevitable change?
An important “must” is to finally embrace a marketing concept. For decades product has been the driver, pushed by manufacturers at a dispensing channel and ultimately at a small portion of those with hearing loss who can benefit. We typically do not start with the customer and his or her needs and mindset in designing the process. And we have almost entirely ignored those family and friends who influence those in need.
Hearing loss is one of the conditions that typically affects the wide demographic of over 45 years of age (to say nothing of a rapidly growing number of young people); yet it remains lowest on the totem pole of recognition and treatment.
Almost everyone has a hearing story, thus becoming or touching a member of “the Tribe”. Why not start with them? They aren’t “patients”...merely people that have a commonplace problem and lack the understanding and access required to confront and alleviate it.
Many of us routinely track our blood pressure.... and certainly our weight! Why not our hearing? Should not everyone be aware of their hearing profile, its change over time and, as deterioration sets in, what can be done to improve its functioning?
Over the last couple of decades, the industry has done a pretty good job of steadily improving the performance of hearing instruments. It’s fallen short, however, in effectively addressing many of those who need and can benefit from them. Family doctors are also an issue as, typically, little training in hearing health is provided and they remain on the sidelines.
So we end up with a standoff of sorts …a very large number of people with hearing problems who remain untreated; yet plenty of service providers (including new entrants) available.
Today’s over 45’s are tomorrow’s (and can be today’s) customers. Many are aware of early signs of hearing loss and will be open to the right messaging. They will not likely be attracted to the present product mix or what is perceived to be high and confusing pricing. Transparency is critical as they are used to evaluating products and services on performance and pricing criteria. Engaging them now with a preventive approach by providing inexpensive devices is not unlike what they are already very familiar with. Better to become their life coach about their hearing health, in many cases serving both them and their parents!
Personally, while in an older cohort, I’d like to think that I could remedy my mild to moderate hearing loss in certain situations by occasionally using a simple inexpensive device with coaching from a competent professional who would act as a resource for me over the next (hopefully) couple of decades. I would expect to acquire more sophisticated instruments, likely at higher price points, as time progressed. I, like so many others, am a member of the very large Tribe that is presently “out there” but not accessed.
Our goal of confronting this quandary aims at enabling and empowering individuals to connect, learn from one another and determine the best course of action.
A reasonable comparison to consider is what is occurring with the Massive Open Online Course (MOOC) revolution – how new ways of delivering university courses are being received by students across the globe, expanding the “student” body in the process. Chances are this will have a significant influence not just on universities (and university professors) but also on how we access education generally. And the movement has gained traction in three short years.
A similar phenomenon may occur in the hearing instrument industry. The key to survive and thrive is to become more ambidextrous - offer both current and a new class of products wrapped in a compelling consumer message. Use world-class technology and social media to connect and encourage learning.
There's still some time. Let’s be aware and prepare ourselves as well as step up the industry dialogue about what actions can and should be taken.
|Terry Mactaggart is the President and CEO of Ultimate Kiosk Inc. (see www.ultimatekiosk.com), a young high growth company with proprietary technology aimed at capitalizing on opportunities in international hearing health. He has substantial experience with private venture creation, financing and growth as an investor, consultant, director, principal, chairman and president a number of companies - both privately owned and publicly traded - as well as of a private equity fund. He has a BA (Political Science and Economics) from the University of Toronto and an MBA from Stanford University.|