1. MarkeTrak VI: Measurement Drives Success – Consumer Feedback on Needs, Benefit, Satisfaction & Value Sergei Kochkin, Ph.D. Better Hearing Institute

2. Agenda Factors impacting choice of dispenser Factors impacting choice of brand Improvements in H.I. sought by consumers The impact of VC on satisfaction The issue of value (price, benefit & satisfaction) Toward a best practices protocol

3. Factors Impacting Choice of Dispenser & Brand

4. Factors Impacting Choice of Dispensing Practice (n=2,251) (Importance scores =4-5 on 5 point scale)

5. Example of Professional Office Dr. Gyl Kasewurm – St. Joseph MI

6. Number of hearing health providers visited prior to deciding on current hearing instrument purchase.

7. Amount of Counseling Time Spent with Hearing Aid Users During Last Hearing Instrument Purchase (H.I. < 6 years compared to H.I. < 1 year). Modal time is half hour

8. Percent of Consumers Receiving Follow- up Customer Satisfaction Survey (H.I. < 6 years compared to H.I. <1 year in age).

9. Overall Customer Satisfaction Ratings as a Function of Counseling Time Spent with Users During Last Hearing Instrument Purchase (H.I. < 6 years compared to H.I. < 1 year).

10. Overall Satisfaction with Hearing Instruments as a Function of Post-fitting Survey Follow-up (H.I. < 6 years compared to HI < 2 years).

11. Key Conclusions Top factors in choosing dispenser: –Professionalism –Convenient location –Convenient hours –Price Minority of dispensers conduct formal post-purchase survey with consumers. Post-purchase survey + related to satisfaction. Customers shop around for dispenser (4 in 10). Modal counseling time spent by dispenser is one-half hour. Amount of counseling + related to satisfaction.

12. Factors Impacting Choice of Brand

13. Factors Considered Helpful When Choosing Brand of Hearing Aid (n=2,273) (Helpfulness scores =4-5 on 5 point scale)

14. Number of Hearing Instrument Brands Taken Home at Last Fitting Prior to Final Purchase (n=1,387 instruments < 5 years of age ) Greater likelihood of receiving multiple brands if the customer is an experienced user with a severe loss.

15. Prior Knowledge 60% of consumers had some to good knowledge of technology prior to purchase. 40% of consumers knew the brand of hearing instrument purchased.

16. Conclusions Top factors considered to be helpful and reliable when choosing a hearing aid brand: –Audiologist recommendations –Hearing instrument specialist recommendation –Medical doctor recommendation –Hearing aid user recommendations Less than 20% consider marketing material or websites as helpful in their purchase decision. 13% customers receive multiple brands at first fitting. –Equates to the 16% return rate in our industry

17. Conclusions Brand awareness is low (40%); technology knowledge is higher (60%). Limited usage of Internet by our key customer (elderly). ALD usage is low – highest is phone amplifier (27%).

18. The Impact of the VC on Consumer Satisfaction

19. Issues Consumer accessible VC (ease of regulating volume) is diminishing with CIC and digital hearing instrument growth. Previous MarkeTrak research: –Use of VC rated desirable (77.5% consumers in US market). –Easier regulation of volume is on wish list of 72% US and 65% German consumers. –Customer satisfaction with volume regulation declined by 11% points in last 10 years. Is removal of VC negatively impacting overall satisfaction with hearing aids?

20. Percent of in-the-ear Hearing Instruments with Volume Controls by Year of Purchase (MarkeTrak VI – n=2352)

21. Customer Satisfaction with Hearing Instruments as a Function of Desire for Volume Control (MarkeTrak VI - H.I.< 6 years)

22. Straight Comparisons of Hearing Instruments With and Without VC In general ITE hearing instruments without VC receive higher ratings (>10%): –Visibility –Comfort with loud sounds –Whistling/feedback –Use in noise –Telephone and cell phone usage The individual who wants a VC but does not have one rates 35 MarkeTrak factors lower by at least 10% points – clearly dissatisfied with the total experience.

23. Isolating VC effect Analysis of covariance –Control for H.I. style, experience, technology On average, presence of VC shown to have negative impact on: –Comfort with loud sounds –Use in noise –Cell phone usage Presence of VC shown to have positive impact on: –Battery life However, there are significant interactions due to experience in favor of the VC.

24. Frequency of Desired Volume Adjustment – Consumers without a VC Source: Surr, Cord, Walden (HJ 2001 n=79 users) Currently the VC is removed for a minority segment

25. Conclusions Consumers do not like to fiddle with their hearing instruments every 10 minutes. Automatic hearing instruments for all consumers should be our goal. Until hearing instruments are PERFECT the categorical removal of the VC will be problematic for some consumers.

26. Conclusions Most likely problem areas are: –Automatic hearing aids are not perfect and cannot predict consumer needs in 100% of listening situations. –Some consumers psychologically need some control over their hearing instruments. –Experienced users are unwilling to part with the VC through habit. The dispenser needs to be especially vigilant to the consumers need to control the volume of their hearing instrument---especially experienced users. –Even an occasional or seldom need is indicative of the need for a VC.

27. Hearing Instrument Improvements Sought by Consumers

28. Hearing Aid Improvements Sought by Current Hearing Aid Owners (n=2,428) (Highly desirable scores =4-5 on 5 point scale)

29. Hearing Aid Improvements Sought by Current Hearing Aid Owners (n=2,428) (Desirable scores =4-5 on 5 point scale)

30. Summary of Consumer Needs – Four Methods Factors </= 40% satisfaction. Factors most related to overall customer satisfaction. Reasons why hearing instruments are in the drawer. Improvements sought in hearing instruments.

31. Factors < / = 40% Satisfaction Hearing in noise Hearing instrument usage in large groups Hearing instrument usage on telephones & cell phones Hearing instrument usage at concerts and movies Whistling, feedback and buzzing Comfort with loud sounds

32. Factors Most Related to Overall Customer Satisfaction Improved benefit at a good value Better sound quality Better Reliability Multiple Environmental Listening Utility (MELU)

33. Reasons Why Hearing Instruments are in the Drawer Poor benefit Inability to hear in noise/background noise Poor fit and comfort Negative side effect of hearing instrument Price & cost of repairs

34. Improvements Sought in Hearing Instruments Speech intelligibility in noise Better sound quality Less whistling & buzzing (feedback) Lower price More soft sounds audible

35. What does it take to turn the hearing instrument market around? (Rihs 1997) The underdeveloped hearing instrument market can only reach its potential if the hearing instrument becomes a true personal communication device. The stigma of hearing instruments will decrease parallel to the increase in hearing performance.

36. What does it take to turn the hearing instrument market around? (Rihs 1997) The degree of user satisfaction is directly related to hearing performance and not the cosmetics. The negative image of the hearing instrument will only disappear when hearing comfort and communication in all environments are guaranteed.

37. The Issue of Price & Value

38. Is This a Common Societal Perception?

39. Issues & Agenda Customer satisfaction with benefit and value are key drivers of customer satisfaction. Without major improvements in these two areas market growth is unlikely. Agenda: –Explore the relationship between price, benefit and satisfaction. –Position our industry relative to other industries on customer satisfaction. –Explore possibilities of best practices selection/fitting/verification/validation protocol

40. Customer Satisfaction with Value, Benefit in Noise, Overall Benefit and Likelihood of Repurchasing (H. I <3 years of age; source MarkeTrak III (1991) – MarkeTrak VI (2000)

41. Method 36 MarkeTrak customer satisfaction studies combined (n=16,519). Conducted between 1990-2002. More than half also administered Abbreviated Profile of Hearing Aid Benefit (APHAB). 26 of the studies have been published. Price of hearing system adjusted for consumer price index in CY2002 terms.

42. Basic Descriptive Data 36 studies Average age of consumer = 69 Median household income = $35,000. 82% bilateral loss/66% binaural user. Half programmable 5% directional 5% DSP 28% BTE (higher than US average) Mean CPI adjusted out of pocket cost of hearing system was $2,308.

43. Measurement of Benefit Combined scales from APHAB –Ease of communication –Background noise –Reverberation Absolute Benefit = Unaided – aided Percent Disability Improvement = (Benefit/Unaided) x 100 Consumer value = $$$/Percent disability improvement.

44. Histogram of Hearing Disability Improvement as Measured by the APHAB (n=8,654). Hearing disability improvement =(APHAB Benefit/Unaided APHAB). Median=44%

45. Validity of APHAB Related to market penetration (unaided). Correlated with customer satisfaction and hearing aid usage. Unaided APHAB correlated (.45 -.68) with: –Pure tone threshold –NU-6 word recognition –Speech in noise test Indirect validity: –Absolute benefit of my studies is 28% –Absolute benefit of the JAMA hearing aid efficacy study (n=360): 29% on NU-6 26% on Connected Speech Test (CST)

46. Hearing Instrument Market Penetration is Highly Related to Recognition of Hearing Disability Source MarkeTrak IV (n=5,954 individuals with self-admitted hearing loss)

47. Relationship Between Price and Customer Satisfaction for Hearing Instruments < 3 years of age (n=13,451) The correlation between price and overall satisfaction is low (+.02)

48. Relationship Between Improvement in Hearing Disability and Customer Satisfaction (n=8,654) Powerful relationship between disability improvement and satisfaction

49. Customer Satisfaction is Highly Related to $$$ Spent per 1% Improvement in Hearing Disability

50. Development of Underlying Models Aggregate consumers into narrow cohorts: –$250 ranges for hearing system (free - $6000+) –%10 hearing improvement range (10% - 100%) 110 aggregates Average consumer per cohort 78 people. Model weighted based on subjects per cohort after calculating within each cohort: –Satisfaction –Hearing disability improvement (benefit) –Average price paid (CPI adjusted)

51. Satisfaction with Benefit and Likelihood of Repurchasing Current Brand of Hearing Aid as a Function of Hearing Disability Improvement.Price is not related to these two variables. (Statistical model) Benefit R 2 =87 Brand repurchase R 2 =66

52. Overall Customer Satisfaction as a Function of Price and Hearing Disability Improvement (Statistical Model) Price Hearing disability improvement (%) Overall Customer Satisfaction (%) R 2 =.86

53. Customer Satisfaction with Value as a Function of Price and Hearing Disability Improvement (Statistical Model) Price Hearing disability improvement (%) Customer Satisfaction (%) with Value R 2 =.87

54. General Conclusions Benefit more powerful predictor of customer satisfaction then price. Customers are rational and will attempt to maximize their benefit. –Less than perfect benefit will result in significant brand shifting –Using the models a 50% improvement in hearing disability= 86% satisfaction with benefit 59% repurchase rate 56% satisfaction with value at $3,000 (binaural) 75% overall satisfaction at $3,000 (binaural)

55. Toward a Best Practices Protocol

56. Benefit is Critical to Market Growth High benefit is related to: –High customer satisfaction –High brand retention High customer satisfaction : –Leads to positive-word-of-mouth advertising –And therefore market growth Important to focus on the dispensers role in optimizing consumer benefit. Development of equivalent of a ISO9002 program to optimize individual benefit at the point of sale.

57. Selection/verification/validation Some Considerations Convene committee of industrys brightest to develop/recommend best practices hearing instrument selection/verification/validation protocol –Medwetsky found wide variability in protocols in 60 practices. –might be a great need for a best practices standard that is widely accepted and used by all hearing care professionals. –Standards may be available but not utilized (e.g. ASHA guidelines for hearing aid fitting for adults) –Washington University School of Medicine Protocol (attached for your review and consideration)

58. Selection/verification/validation Some Considerations Fitting formula have become more sophisticated but they are still a starting point. How many dispensers use the default settings versus attempt to optimize individual benefit at the point of sale? There will be significant differences in outcome measures both in terms of speech intelligibility and subjective consumer preference depending on which prescriptive formula is used. (See January 2003 Hearing Review) May be significant interactions between prescriptive formula, individual hearing loss characteristics, style/circuit of hearing instrument, and perhaps even the personality of the end-user.

59. Selection/verification/validation Some Considerations Advanced multivariate research (e.g. use of artificial intelligence software) could lead to the development of a prescriptive decision tree which would assist the hearing care professional in optimizing benefit for the end-user. Does the lack of wide scale adoption and/or usage of real ear measurement impact benefit? –50% of HIS own –75% of audiologists own Does the lack of wide scale adoption and/or usage of hearing aid analyzers impact benefit (e.g. measurements on the functionality of the hearing instrument). Is a listening test enough? –59% of HIS own –85% of audiologists own

60. Selection/verification/validation Some Considerations Assure audibility of important sounds (especially speech) and loud sounds should be comfortable: –44% satisfaction with loud sounds comfortable in a custom industry is unacceptable. Measurement of unaided and aided speech intelligibility in quiet and noise. The difference is benefit (see January 2003 Hearing Journal) : –Minority of dispensers and audiologists measure benefit routinely. –Subjective (APHAB), or objective (HINT, QuickSIN) tests widely available. Share benefit scores with consumers helping to shape realistic expectations.

61. Selection/verification/validation Some Considerations Should we establish contracts with consumers promising certain levels of benefit in quiet and noise based on our knowledge of the consumers hearing loss characteristics? Does the use of patient focused 360 sound field aided testing (e.g. Beltone Avenue) have a positive impact on maximizing individual benefit? –Preliminary research shows < fitting time –No impact on APHAB benefit scores Should consumers be made to pay for hearing instruments with little or no measurable benefit? (e.g. speech intelligibility improvement).

62. Selection/verification/validation Some Considerations Measurement of longer term customer satisfaction (3+ months after fitting). –Minority- 18% do any form of formal follow-up. Issue of value assures that the consumer expenditure of energy (time, money) is exceeded by the dispensers energy expenditure (time, service, product).

63. Selection/verification/validation Some Considerations Industry associations should validate the best practices in order to gain wide scale acceptance of a golden or best practice protocol: –Customer satisfaction –Consumer benefit –Profitability –Dispenser morale –Practice growth –Referrals –Return rates Turn best practices protocol into equivalent Good Housekeeping Seal of Approval. Implicit in such a seal is a benefit guarantee to the consumer.

64. Some Methods for Improving Satisfaction 10%-20% More counseling time with consumer. Creating realistic expectations especially given very high consumer expectations of DSP. Any form of outcome measure (benefit). Use of VC especially for experienced user. Directional hearing aids as standard technique for improved communication in noisy situations. More patient focused techniques for optimizing benefit. Creating more perceived value for the consumer.

65. Some Final Considerations Measuring performance helps drive success. Without effective measurement how can we assure we have optimized the customers hearing experience? Without effective measurement how can dispensers grow in their wisdom on behalf of the consumer?

66. Sample Protocol Washington University School of Medicine Established appropriate prescriptive REIG (corrected for mixed HL (>20% of A-B gap) and/or binaural summation (<3-5 dB)) REM for nonlinear hearing aids with input levels of 50, 65 and 80 dB with speech-weighted composite noise (analog) or modulated ANSI noise (DSP) provides appropriate gain and smooth frequency response. Printout placed in chart. REM for linear hearing aid with input level of 65 dB with speech-weighted composite noise (analog) or modulated ANSI noise (DSP) provides appropriate gain and smooth frequency response. Printout placed in chart.

67. Sample Protocol Washington University School of Medicine Assessed performance of directional microphone by looking @ differences in REAR @ 0 0 and at azimuth of greatest null. Printout placed in chart. Assess functionality of DSP NR circuitry using appropriate bias signals. RESR 90 using a pure-tone sweep corresponds to appropriate frequency-specific SPL level for loudness judgment of loud, but OK. Printout placed in chart. Loudness judgment of 50 dB composite noise is very soft or soft

68. Sample Protocol Washington University School of Medicine Loudness judgment of 65 dB composite noise is Comfortable, but slightly soft, comfortable, or Comfortable, but slightly loud. Loudness judgment of 85 dB composite noise is loud, but OK. Measure aided thresholds @ 500, 1000, 2000 and 4000 Hz using FM signals @ 0 0 * Measure unaided and aided HINT (dBA) in Quiet with sentences @ 0 0 * * Currently under consideration

69. Sample Protocol Washington University School of Medicine Measure unaided and aided HINT RTS in Noise with Sentences and Noise @ 0 0 * ANSI-96 reveals <10% THD; ANSI-92 reveals smooth coupler response @ 50-80 dB SPL. Printout placed in chart. Potentiometer or programmed settings are in the chart. Discuss and/or recommended Aural Rehabilitation and/or ALDs. * Currently under consideration

70. Sample Protocol Washington University School of Medicine APHAB, COSI or Wash U Questionnaire (unaided, aided and benefit) and placed in chart. Called patient 2-3 days post-initial fit. Customer satisfaction survey (3-6 months after fitting) – Kochkin recommendation.