Editor’s Note: Today’s commentary continues the ongoing discussion over Phonak’s recent decision to begin distributing its hearing aids through Costco Hearing Aid Centers nationwide. As I promised yesterday, today’s Hearing View exclusive comes directly from the Phonak president, Jeff Newnham, addressing the company’s new partnership with Costco.

We would like to thank Mr. Newnham and Phonak for their willingness to respond to our requests to address some of the rumors and help clarify the company’s position on its decision to partner with Costco.

By Jeff Newnham

Jeff Newmadfam, Phonak President

Jeff Newnham, Phonak President

The decision to offer Phonak branded hearing aids to Costco was based on several reasons:

  • We want to help all hearing-impaired people, including those consumers motivated by price who prefer a value practice model for their hearing care.
  • We believe that Phonak provides the most innovative technology available today and we want to make these products available to as many people as possible so that they may live their lives without limitation.

Phonak Brio is marketed for Costco to provide a level of brand name protection to our independent hearing healthcare providers by not allowing consumers easy price comparisons across different retail or independent practices.

Phonak technology provides positive impact to millions of lives in the United States, and we couldn’t do this without our current customer base of independent providers, who are the backbone of the US hearing industry.

Our Phonak commercial sales team, clinical trainers and internal customer support teams are dedicated to the independent hearing healthcare providers and their respective businesses. We have no intention of changing our high level of commitment to the hearing healthcare community, and will continue to partner with them to help grow their business by offering innovative solutions for those in need of hearing healthcare.

 

Jeff Newnham is president of Phonak LLC.  Headquartered in Warrenville, Illinois, Phonak LLC was founded in the United States in 1989. Phonak LLC is a Group Company of Sonova Holding AG.

15 Responses to Exclusive: Phonak President Responds to Concern Over Costco Partnership

  1. Jan says:

    I love the product, but disappointed in Costco’s support. Need a basic user guide, not a sales brochure, as I already purchased the Phonak. Costco sales reps attempt to sell a product that they do not fully understand and unwilling to support. Also, the reps should not complain about each other to the customer. Very unprofessional.

  2. Joe says:

    what rubbish – so independent providers, the “backbone of the US hearing healthcare industry,” don’t provide “value.” And although Mr. Newnham is so committed to “make these (Phonak) products available to as many people as possible so that they may live their lives without limitation,” he continues to gouge the backbone of the US hearing healthcare industry with obscenely inflated prices so that we have to charge prices, in order to stay in business, that make Mr. Newnham’s HAs unaffordable for so many people. Excuse me while I go throw up.

  3. Abbey says:

    I use Phonak for most of my patients but I’m rethinking my options. I’m tired of a company telling me on one side that they are there to help my business grow and then stabbing me on my back over and over. First they advertise Liric but is not available to all offices. Then they open their own stores right in my community and become another competitor. Now the final straw, putting their name directly with Costco. Phonak has become the whore of hearing aid manufacturers, the cheating wife that will give their goodies to anyone. If you want to help those members at Costco why not just call the product “Brio” without the Phonak name. I called 2 days ago to ask for a Milo UP for a patient with a very low budget and was told they will not have it any longer. Don’t spit on my face then call it rain. The truth is Phonak does not care if my budget patients get help by me now that they are in bed with Costco. I will bring this issue with the FSHHP to see if Phonak is a sponsor to this years convention because if they accept money from them they are just as bad. The only way to keep this from happening is to band together and boycott manufacturers that whore themselves and support those that don’t.

  4. Johnatsams says:

    It’s just business ! If you think buying at Sam’s, Costco or any other discount provider is offering sub par or inferior quality product or service then you need to come and see our practice. We are licensed and regulated by the same State Board that everyone else is. I’m told over and over again that I do the most thorough test that people have had and that’s coming from people who have been tested and fit by audiologist. At Sam’s we manufacture our own products. I would put our products up against any body in the industry today. The day’s of hearing aids costing $5,000 – 6,000 are coming to an end. again … it’s just business.

  5. Hunter]..............................................................hunter says:

    We believe that Phonak provides the most innovative technology available today and we want to make these products available to as many people as possible so that they may live their lives without limitation. is so concerned with helping as many people as possible.
    If this is really what they believe then why not make these same devices available to all of the independent dispensers at the same price point. Evidently you are underestimating the average intelligence of the Costco consumer.

  6. Beth says:

    If he states “We want to help all hearing-impaired people, including those consumers motivated by price who prefer a value practice model for their hearing care”, then offer the SAME pricing to audiologists in private clinics, so that we can offer a more affordable option for these patients that are “motivated by price”.

  7. Karen Brockett says:

    Having a hearing loss is extremely more complex than being near or far sighted. I know first hand because I have all three conditions. Unlike my glasses which restores my vision to 20/20, no hearing aid will restore a person’s hearing to “normal”. Selling them through a discount outlet leads the consumer to believe that hearing aids are similar to eye classes and that all they have to do is shove a hearing aid in their ears and presto, normal hearing.

    The major difference for the consumer, and this is a significant one is that when the consumer goes to pick up her/his glasses and puts them on, she/he will see “normally”. When the consumer picks up the hearing aid and puts it in his ear, it will not be exactly matched to the hearing loss. It will need to be fine tuned by someone with appropriate training in the complexities of hearing loss, not just with a specific brand of hearing aid.

    An independent product testing group found that hearing aids programmed at the manufacturers were never accurately matched to the person’s hearing loss. This has been my experience was well and I have worn hearing aids for 30 years and have had aids from four different manufacturers.

    As an advocate for those with hearing loss and someone who has lived most of her live with a “hearing impairment”, I have concerns about the cavalier attitude of Phonax’s president about the needs of those of us with hearing loss. All his press release says to me is “to hell with the welfare of those with hearing loss, I want to sell as many hearing aids as possible.”

    As a consumer ask yourself this. Would you be willing to go to Costco to get your teeth straightened or have dentures made and fitted just because the manufacturers of those devices were giving Costco a price break? Hearing as well as is possible is important to both your physical, social and emotional well being. Is this really where you want to buy cheaper?

  8. Charlotte Godfrey, Au.D. says:

    I think we are barking up the wrong tree. Non-prescription eyeglasses are sold everywhere and optometrists are still in business. So what if the hearing aid companies sell at Costco. The problem is price discrimination. Collectively audiologists provide more business for hearing aid companies than Costco. They should be selling them to us for the same reduced rates. We could then fit ” value practice models”, and provide quality post-fitting care as usual.

  9. Guy Martin says:

    There are two factors I take issue with regarding Jeff Newnham’s statement :

    ONE, The use of the PHONAK name on the hearing aids provided to COSTCO simply leads potential customers to assume that they’re getting the same hearing aids at a price discounted over the average dispenser.

    TWO, Assuming PHONAK’s actual goal is to provide a “value practice model”, then exactly why is the ‘Brio’ simply the ‘Bolero’ Q90, with a slight limitation on the software?

    Evidently, PHONAK way underestimated the intelligence of the independent hearing aid dispensers.

    Among those who are ecstatic regarding PHONAK’s decision, are: REXTON, STARKEY, OTICON, SIEMENS, MICROTECH, RESOUND, AUDINA, PERSONNA,,,,,,,,, etc.

    They’re ALL receiving numerous product inquiries from those who were formerly high volume PHONAK dispensers.

  10. Larry says:

    If Phonak is so dedicated to independant hearing providers, why don’t they
    charge us the same as Costco for their products.
    If they can afford to sell to Costco at such a discounted price, they can afford
    to sell to us at the same price.

  11. Paul says:

    Even though I do not believe that Phonak is necessarily any more evil than the rest of the manufacturers in regards to directly competing with their customers, there certainly are a lot of smoke and mirrors in this explanation. Here are my thoughts below on some of the comments made.

    “We want to help all hearing-impaired people, including those consumers motivated by price who prefer a value practice model for their hearing care.”
    Paraphrase: We want to sell more hearing aids, even if it means treating a hearing aid like a commodity and undercutting our current customers and practitioners.

    “We believe that Phonak provides the most innovative technology available today and we want to make these products available to as many people as possible so that they may live their lives without limitation.”
    Paraphrase: At Phonak, we believe that our hearing aids are better than the people who fit them. We want to sell more of them and we are going to do whatever it takes to make that happen.

    “Phonak Brio is marketed for Costco to provide a level of brand name protection to our independent hearing healthcare providers by not allowing consumers easy price comparisons…”
    Paraphrase: Ok, it’s the same hearing you are fitting, but we’ve changed the name to make you feel better. We are confident that consumers won’t be able to figure out that they are the same hearing aids, even though they are made by the same manufacturer, look the same and have the same specs.

  12. DG says:

    I’m with James on this one. I did not work with Resound,Starkey, or Siemens for a reason… because it’s affecting the audiology profession. I mainly worked with Phonak, I guess not anymore. I will work with Widex from now on—since it’s still family owned and does not sell their products at retail stores or hearing aid stores.

  13. James Downing says:

    As an independent hearing healthcare professional, I will not sell another Phonak product due to this decision by some off the wall administrator. I have a hard time even thinking about working with any product sold by their parent company. Love the people I have worked with. Hate what this will do to the industry and to my bottom line!!!!

  14. Dan says:

    I’d like a clear definition of –
    “…value practice model for their hearing care”
    anyone?
    Bueller? Bueller?

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