STRATEGY AND BUSINESSES

Sonova’s Hearing Instruments business serves a global market through our Phonak and Unitron brands. Our goal is to maintain and extend our industry-leading position in innovation, both in technology and applications, making a substantial positive difference in the lives of our consumers. Our solutions are designed first and foremost to provide an ever-better hearing experience, with excellent sound performance, comfortable listening, and easy, intuitive use. But they also do more: through advances in sensor technology, apps, and connectivity, they are evolving into “healthy living companions,” essential supporters for a full, active life long after the first appearance of a hearing loss. This evolution will bring us ever closer to our consumers: their as-yet-unmet needs and hopes will continue to shape our innovation and the way we build our business.

Innovation across the cycle

Our structured innovation process builds on successive advances in fundamental technology: each new platform supports breakthrough capabilities that transform performance and functionality across our product range. Introduced in August 2020, the Paradise technology platform offers unrivaled sound quality, universal Bluetooth® connectivity with multiple connections, hands-free calling, and Tap Control for easy control of streaming functions. Over 2.5 million Phonak Paradise hearing aids were sold in the 2021/22 financial year, despite the challenges of a global pandemic: a new record for a single platform. In surveys, 90% of consumers said they would recommend Paradise to family or friends and 92% of hearing care providers would recommend Paradise to their peers.

Midway through the innovation cycle, we extended the appeal of Paradise with several significant new capabilities. The ActiveVent™ Receiver is the world’s first hearing aid receiver that automatically opens and closes based on the listening environment, intelligently balancing speech clarity with listening comfort , delivering superior sound quality for streaming media , and providing an average of 10% better speech comprehension in noisy situations .

Launched in August 2021, Phonak’s Audéo Life is the world’s first rechargeable hearing aid that is waterproof, showerproof and sweatproof, offering all the functionality of Paradise in a form that enables a healthy, active lifestyle without limitations.

Paradise-powered Phonak hearing aids already have a motion sensor that helps to assess hearing situations and adjust sound processing for clearer conversations on the go. Now Audéo Fit, introduced in mid-2022, adds a heart-rate sensor, allowing users to monitor their daily steps and exercise programs through the MyPhonak app, just as they would with a fitness smart watch. Audéo Fit represents another significant step toward the hearing instrument as a healthy living companion.

Meeting customer needs through commercial excellence

The wholesale customers of Sonova’s Hearing Instruments business are almost as varied in their needs as the consumers they serve. They range from independent audiologists to buying groups, small and large retail chains, government agencies, and managed care providers. Giving a tailored service to each of them requires a multi-channel approach which is systematic in its planning but agile in its execution.

Our relationships with customers range from straightforward sales transactions to a more consultative partnership backed by value-added services. These can include training and education, bespoke marketing support, or help with building a stronger business including enablement for e-screening, digitalization, and omni-channel sales. As part of the Sonova X Business System, we back these relationships with a structured sales excellence program based on optimized territory design and coverage; segmentation and targeting; coordinated B2B marketing; and close integration between global and local teams. The aim is to sustain sales growth throughout the innovation cycle, gaining new customers and helping them to gain and retain new consumers.

Building presence in high growth markets

Hearing loss is a global reality, but it is treated very differently in different countries. The territories that Sonova identifies as “high-growth markets” include the most populous countries in the world, where currently only around 3% of consumers with hearing loss adopt a hearing aid, against approximately 30% in developed markets. There is huge untapped growth potential for Sonova, especially in countries such as China, where the population is aging and hearing loss is becoming more prevalent.

Realizing that potential, however, requires addressing the various issues that lead to low adoption in these markets directly. We are increasing our physical sales presence, adding new representatives and building local strategic partnerships: in China, we will expand our sales coverage by close to 30% in the next two years, moving beyond the top-tier cities. We are also in continuous dialogue with the Chinese government and institutional stakeholders to help increase access to audiological treatment.

Possibly most important, we are addressing one of the key obstacles to hearing aid adoption: the lack of trained audiologists. In the US, there is one hearing care professional for every 9,000 potential consumers; in China, the figure is one in 90,000. We therefore established in 2020 the award-winning Swiss International Hearing Academy (SIHA), which offers extensive in person and online audiology training. We are continuing to expand the number of students and courses available, with a particular emphasis on audiologists based in smaller cities. The goal is to put in place the building blocks of a vibrant hearing care industry to meet pent-up demand and realize the growth potential.