Costco quietly launches latest Kirkland brand premium hearing aids
Retail
This past week, Costco quietly rolled out the latest iteration of its “Kirkland Signature” branded hearing aids in stores across the United States.
As reported by HHTM in August, to the surprise of many analysts and industry insiders, GN ReSound did not have its contract renewed to become the retail giant’s Kirkland Signature brand supplier–which it had been since 2013. Instead, confirming weeks of speculation, Sivantos (formerly Siemens) is the new Kirkland Signature hearing aid supplier.
Furthermore, Costco has set the price at $1,699/pair, which is $100 less per pair than the previous generation of Kirkland hearing aids and well below the prevailing premium price at Costco for a pair hearing aids ($2,598/pair or $1,299 each for most premium tier devices).
Hearing Aid Price Cut Trend Continues
Price reduction for successive generations of Kirkland Signature hearing aids is an ongoing trend. The previous Kirkland hearing aids cost $1,799/pair — less than 3 years ago, they were $1,899/pair.
As the biggest hearing aid provider outside of the VA, Costco’s continued price reductions have influenced the US hearing aid market. Pricing pressure, in addition to calls to lower hearing aid prices from the NAS and PCAST report, has been felt across the industry in recent years, but most substantially by small independent clinics which rely heavily on revenues generated by hearing aid sales.
Additionally, industry insiders say that there is increasing concern among major hearing aid manufacturers about a perceived shift in focus at Costco’s hearing aid centers, with more emphasis now on Kirkland-branded devices than in prior years:
“Costco has changed the strategy with Kirkland, they lowered the end user price by another $200 for two instruments, so they are down now from $2,000 to $1,800 for two fully fitted instruments, and that’s a brutal low price” (Sonova CEO, Lukas Braunschweiler in May 2016 Reuters interview).
With the continued pressure on price, there appears to be a general sentiment of concern among the major hearing aid suppliers that the companies will have to sacrifice higher levels of support currently offered to hearing professionals using their products, both inside and outside of Costco.
What Do the Kirkland Hearing Aids Offer?
The latest generation of Kirkland aids claim a number of advanced features, including wireless capability and compatibility with smartphone Apps for Android and iPhone.
Whether the new Sivantos-made hearing aids are a variant of its current Rexton Trax 42 devices (currently available in Costco) or something different, is still unknown.
Considering the recent history and popularity of the Kirkland-branded hearing aids, it’s very likely, barring any major issues with the launch, that Sivantos will quickly overtake its competitors to become the largest hearing aid supplier to Costco within the next several months.
Acknowledgement: By mutual agreement, this article written by Bryan Taylor is republishedwith permission from Hearing Health Matters, where it originally appeared on September 20, 2016.
