Imagine if 42 million people in the U.S. had a medical condition that kept them from enjoying life and less than half of them took steps to fix it.
That’s the situation currently with hearing loss, which is the third most common medical condition in the U.S. And 26 percent of that population has avoided getting help for the problem due to high cost and a demeaning customer experience.
A growing direct-to-consumer (DTC) brand aims to fix the stigma around hearing loss as well as the equipment issue that hinders its treatment. Eargo is a medical device company with a difference. It combines an innovative product with a DTC approach that takes away some of the barriers to hearing loss treatment.
First, to take away the stigma of bulky behind-the-ear hearing aids, its products are worn inside the ear.
Second, the products come in rechargeable versions, including a new product designed for adults with mild-to-severe, high-frequency hearing loss, called the Neo HiFi. It is the fourth generation of Eargo product containing features you might expect to find on high-end headphones: increased bandwidth, feedback cancellation, and a wind noise reduction algorithm for enhanced performance processing speech outdoors.
Finally, the price. While hearing aids can go as high as $8,000 with spotty insurance coverage, Eargo products can be purchased for less than half of that price.
The company is currently being run by CEO Christian Gormsen, who left a career as an investment banker and management consultant to be part evangelist and part salesman for his product.
“When I saw Invisalign technology [for teeth straightening], I thought that this is something that can take the paranoia out of braces because you could simply take them out,” Gormsen said. “And you created a multibillion market for adults who could now benefit from having a smile. In a similar way, when I saw Eargo, I couldn’t believe it was a hearing aid because it was so small and could be removed easily. And you know what? When I heard it, it sounded like a real hearing aid. I could hear the technology at work.”
With the technology in place, Gormsen said he knew it was safer than other products and less expensive. But it’s still an expensive proposition. The new Neo HiFi costs $2,950, although financing is available at $137 per month.
The challenge Gormsen faced was getting the word out about the product through what is essentially a clinical process. In other words, the potential customer would only look for the product if the symptoms showed first, and would most likely ask a doctor.
So, Gormsen quickly went to DTC tactics. He started with the senior demographic, mostly with paid social. Next, because paid social can be limited in conversion rates, he switched to search and native ad strategies, including YouTube videos. Content marketing, he said, has been a strong tactic for getting the word out to the senior community.
But the price point is still something Gormsen said he wants to address.
“Price, you know, it’s actually a tertiary consideration,” he said. “No. 1 is the product. No. 2 is the customer support and making sure that we can really give people a great experience. And then three its price. So, you provide payment plans, which is obviously very, very helpful. If you went to a clinic, you know, they would get you a more expensive product that might not be as good. The average price of a pair in the U.S. is $4,600. And that’s typically been not very attractive.”
Gormsen is doing more to get the product to the right audience. Eargo has formed a partnership with tech-boutique chain b8ta. During its Meet the Maker series, consumers can try the Neo HiFI in the presence of a licensed hearing professional for a personal demo. Buyers get a $100 discount.
“It has been an amazing partnership, and it’s something we want to continue to build,” Gormsen said. “Of course, data is not a national retailer, and I think there’s a lot of opportunity there. The question is how do we make sure that we give the customer a great experience, and that’s what we love about b8ta. They have tested, and they deliver a great experience. So, how can we also influence that experience in a bigger setting? But the challenge with a national retailer is that they are not able right now to give that customer experience.”
Eargo has also formed a partnership at Songs for Sound, a nonprofit working to increase access to quality hearing healthcare and opportunities for those with hearing loss and deafness. Songs for Sound’s Hearoes Tour kicks off this month and runs through June. According to the partners, the year-long tour will spread awareness of hearing loss and encourage the millions “suffering to take the necessary steps toward better hearing health.”