Using Hearing Aid Batteries as a Tool to Grow Your Business

This is a transcript of a live expert e-seminar. Download supplemental course materials.

KEVIN KOUBA: My name is Kevin Kouba and I am the Director of Sales for Rayovac North America in our Professional Hearing Aid Battery Division.  Today’s seminar will discuss how to use hearing aid batteries as a tool to grow your business.  Meredith Rockafellow Van Sant, is our Major Account Manager and will be presenting with me today. 

MEREDITH VAN SANT:  Today we will cover three main topics.  The first is how you can use batteries to strengthen your relationship with your patients.  As an audiologist, having a strong relationship with your patients is critical.  We will also discuss ways to incorporate batteries within your practice including what type of battery programs will best fit within your business.  Lastly, we will discuss what points you need to consider in choosing the right battery partner to help you meet your professional goals.

Patient retention is critical to your practice.  By offering batteries, you can create value for your existing customers by providing a solution to their need.  You give your patients a reason to return to you.  Marketing batteries also give you an additional touch-point with your patients.  Batteries also create satisfied, loyal patients.  Loyal patients tend to stay with you longer and pay less attention to competitive offerings they receive in the mail.  As you may know, it costs much less to retain an existing patient than to gain a new one.  In addition, word-of-mouth tends to spread faster than any marketing that you do.  By offering batteries, you can provide a reason for your patients to refer other people to you.  It is a simple way to bring in new business. 

Your patients will continue to need batteries. 

How can hearing aid batteries play a role in strengthening your relationship with your patients?  Batteries should be one of your business' best practices.  Here is one thing to think about in your current practice.  Are your patients loyal to you, and is your practice top-of-mind when they are thinking about their next hearing aid?  If one of their friends or family asks them who they go to for their hearing aids, are they thinking of you?  If half of your patients are currently going elsewhere for their batteries, where will they go when it is time to purchase their next hearing aid?  If they are relying on you for batteries, they are going to be thinking of you more often, which is definitely something you want them to do.

A good place to start would be with benchmarking your business.  This allows you to understand where your battery business currently is, how large your battery business should be and the gross profit potential that you can expect.  Rayovac has an interactive benchmark calculator to help make this exercise easy.  We offer it on our professional Web site, www.thepowerofhearing.com, whether you are currently a Rayovac customer or not.  At this Web site, you will find the Benchmark Calculator under Business Builders from the home page. 

Let’s practice with some sample data.  First, you will need to enter in the number of hearing aids sold for the past 5 years.  Let’s say for the current year you sold (or expect to sell) 350 hearing aids.  Maybe last year was a slower year with the economy, so you sold 340.  The year before that, 280.  The year before that was a better year, so we are going to mix it up and say that you sold 350 that year.  Five years ago, you sold 320.  Total those numbers and you come up with 1,640 hearing aids sold. 

Now you can look at how many batteries you have sold, per individual cell.  For our example, let’s say you sold 6,000 batteries.  The average price was $1.00 per battery.  We do find that this would be the national average. 

Per customer, we are seeing an average of about 36 batteries used per aid in a year.  Some of the newer aids with advanced technology and added accessories may use more, but 36 batteries per hearing aid is a good average starting point and will give you a pretty good idea of your potential battery market.  In this example, if you sold 1,640 hearing aids, your potential battery sales would be 1,640 x 36 or more than 59,000 per year.  From that, we can go down and see that if the sample potential market was 59,000 you have about 11% market-share based on your sales of 6000.  Next, calculate your profit margin.  If batteries sell at $1.00 per battery and the clinic is making a 50% margin, which is pretty reasonable, this clinic could have made $29,000 in profit from batteries alone.  It is definitely a significant amount of money. 

To Sell or Not to Sell?

The next step to making batteries part of your business is to decide what role you want them to play.  Are you going to sell them, give them away, or offer them as part of a service package?  To help you decide what is best for your practice, we will review each of these three options.  Think about how you are currently using batteries in your practice.  Is it the best way for you to offer them, or perhaps you should think about changing things around?  Or, if you have never offered batteries, you may start considering offering them. 

There are some effective ways to succeed in selling batteries.  We call it the Profit Maker.  The most obvious reason to sell batteries is that they do generate income for your bottom line, especially right now in a tougher economy where selling hearing aids can be a little more challenging.  It is nice to have that extra help to your bottom line.  We saw the potential for income based on the benchmarking exercise.  When you do offer batteries, you can control the price of your battery; therefore, you can control the margin that you make on the batteries, which is a nice benefit.

Having batteries available for purchase when your patients are in your office also helps capture the battery sale and provides a convenient solution for patients, which in turn, helps with patient retention as we discussed earlier.  For example, instead of making a separate trip to the store, patients can buy the batteries when they are in the office.

On the other hand, there are some things to be aware of when selling batteries.  Keep in mind that you do have competition.  There are other professionals and major retailers selling batteries.  Rayovac has done many studies, and we have found the following.  When asked where they obtained their batteries over the last 12 months, 53% of patients who were surveyed purchased their batteries in a drug store or a pharmacy (Chamberlain Research, 2010). Next was a discount or a department store, and third was the audiologist or physician.  Only 24% reported currently purchasing batteries from their audiologist or physician.  This leaves a lot of room for capitalization.

It is a fact that your patients visit the drug stores or the department stores much more often than they visit you.  If your patients are visiting you every six months or less, then they have to be buying batteries somewhere else.  I have talked with some practices that say, "No.  I know they are only getting batteries from me.  They are not buying anywhere else."  So I then asked what size packages they were selling and found they were selling 4-packs.  I asked them how many 4-packs they would sell at once, and they said, "My patients usually buy one card."  Obviously they are buying them somewhere else in between or they are not wearing the hearing aids. Are you losing out on battery sales?

Many patients purchase once every two or three months, and they tend to buy a larger amount of batteries at one time (Chamberlain Research, 2010).  Furthermore, if your patients are purchasing batteries elsewhere, you cannot control what battery they are buying.  You may be recommending a particular battery and they may be purchasing something else.  Not all batteries are equal. 

I am sure you have all had patients come in and say, "My hearing aid is not working," and then it turns out that it is just the battery.  It takes both their time and your time to come in and troubleshoot the hearing aid.  Some patients may even wonder if they bought the wrong hearing aid.  It is a large purchase and you do not want to make them think that there is a problem with the hearing aid, when the real problem is a bad battery they had purchased elsewhere. 

Within the retail market, you really cannot tell how old batteries are.  Many retailers hold large amounts of stock and then ship out to their smaller stores.  The average battery in a retail store is at least nine months old, but they can be anywhere up to two years old.  An older battery is more prone to gassing and leakage, which can damage the aid.  Rayovac does guarantee our batteries.  If an aid is damaged by our battery, we will replace the hearing aid.  That is not the case with all battery manufacturers.  If your patient is buying a battery at the store, it is going to be hard to track down who manufactured the battery, and either they or you are going to be responsible for fixing the hearing aid.  These are things to keep in mind if your patients are buying their batteries at a store.

Selling Batteries

Packaging

Say you have decided to sell batteries.  How are you going to do it?  Packaging is very important.  Offer the large pack sizes, such as a value pack or a 48-pack.  This is an advantage to you.  When we asked consumers how many batteries they typically purchase at one time, 29% said they purchase up to 7 at once, 40% said from 8 to 16, and 31% said 17 or more at one time. When you offer a larger package size, you can generally receive a lower cost to you.  At the same time, you can then afford to offer a good value to patients, which helps you to be competitive and also still make the margin that you want to make on your batteries.  This can definitely help with bigger sales. 

Also, when you offer patients a larger package, you are locking up their future purchases so they will not be buying from somewhere in between their visits to you.  If you do sell them a larger package that will get them through until their next appointment six months down the road, and you know they are not going to be buying batteries somewhere else.  That is a huge advantage to you.

Marketing

Marketing is also very important.  Offer battery specials or incentives as a retention tool for your office.  If you have a newsletter that you send out to your patients, make sure it communicates your battery specials.  If a newsletter or e-mail is new to your office, consider simply mentioning that you offer batteries.  Battery clubs can be a great way to reward your patients for their loyalty.  You can have a punch card or battery club booklets.  There are various different ways to set up a battery club.  In conjunction with that, you might consider having a program, where you mail out batteries to your patients’ homes.   If you have people who are not able to get in to the clinic or live in a nursing home, these patients really appreciate mailing programs. 

Merchandising

Make sure that you merchandise the batteries.  Have a nice display rack where your patients are able to see them, such as in your waiting area, so that batteries are on their mind.  People are more likely to buy batteries if they see them there.  You also want to be sure to educate your office staff so that batteries are on their mind, as well.  Educate them about the sizes and types of batteries and how much you are charging, as well as any specials or offers you have.  

We asked consumers where they go for their hearing aid battery information, and 63% of them go to their audiologist or hearing care professional, which is ideal (Chamberlain Research, 2010).  You want them to view you as the hearing aid battery expert.  Make sure you educate your staff so they can answer any questions very efficiently, as they are an extension of you in the office.  Make sure they are asking patients as they are leaving, "Do you need batteries today?"  Sometimes simply asking the question is the perfect way to get the sale. It also lets patients know that you are thinking of their needs.  When patients feel informed and confident in their information source, they are more likely to be loyal and come back for additional information or services.  If you, as a clinic, are uncertain about batteries, you can always contact us at Rayovac to answer questions and help educate staff.  Whether or not you buy the batteries from us, we are always more than willing to help.

Giving Batteries Away

Here is another question for you.  How many of you currently give away batteries in your practice?  Instead of selling batteries, some practices do decide to just simply give them away.  We call this the "Traffic Maker."  There are some benefits to giving away batteries, one of which is that it keeps patients coming back to your office.  If they do not have to pay for batteries, they are going to come to you when they need them.  That is obviously a good thing because they will take that extra time to come see you.  By adding this value, it creates the likelihood that when they buy their next hearing aid, they are going to be thinking of you.  They are going to remember that last time you gave them free batteries.  I was actually just talking with an office that has 100% patient retention, which is amazing.  One of the things they do is offer free batteries for their patients.

There are some things to consider about giving away batteries.  If you are offering batteries, obviously, it can be very expensive.  Many of the newer hearing devices use a lot of battery life, especially those that use wireless streaming devices or accessories like FM systems.  These types of features and accessories require a lot of power.  If you are going to give away batteries, make sure you keep this in mind.  Some patients may not get the battery life they are used to when they get a new hearing aid with advanced features, so counsel them accordingly and be aware that this also means that you are going to give away more batteries than you used to.  Make sure you are educating patients on the proper way to store their batteries when they are not using them.  Provide them with patient brochures that explain these things, and make sure they also understand the dollar value of what you are giving them.  In general, when people get something for free, they tend to not value it as much as if they had paid for it. 

If you do give away batteries, when deciding which batteries to purchase for your practice, do not base your decision on price alone.  Rayovac asked hearing aid wearers to compare battery packaging, price and the performance to see what was the most important to them.  Performance is overwhelmingly the most important thing to patients when it comes to batteries (Chamberlain, 2010).  If you are buying a cheaply-made battery, your patients are going to notice it.  You do not want that to reflect on your business and make people think you have inferior products.  Another critical factor is that with a cheaper or imported product, you expose yourself to using more batteries because these batteries do not tend to last as long.  This actually will cause you to spend more money in the long run. 

Moreover, if you are going to give away batteries, make sure that you have a plan set in place, that everyone in the office knows the plans and that they have the tools to manage it.  So many times office staff may just give them out because they do not realize how much they can cost.  Make sure your office staff is aware of the cost.  If you do not want to go into a full explanation, make sure they understand that it is not something that is free to the clinic.            

It is very common for the staff to give away more than the patient needs.  If you do not have a plan in place that includes documentation, you are going to be going through more batteries than you budgeted for.  Have a plan that includes documentation, and inform the staff of the true cost of the batteries, so that they can make a more conscious decision about giving them away.

Service Package           

A third way to handle batteries in the office is to make them part of a service package, or what we call a “Loyalty Tool”.  When a service package is offered at the time of the sale of a hearing aid, it may include cleanings and checkups, usually a warranty, and often batteries.  Sometimes this is done by establishing that the patient receives X number of batteries per year, or you may dispense the entire amount up front at the fitting.  The batteries are generally offered for the length of the service package.  For example, if the service package covers two years of maintenance on the aid, then it would also generally cover two years worth of batteries. 

Including items like batteries in a service package provides an extra value to your patient.  Batteries are an ongoing expense for patients.  If they are getting a newly upgraded aid with advanced technology, you can point out that these aids generally use more battery life than their old aid, and therefore it is a great benefit to have a service package.  A service package can set you apart from your competition and further help with your patient retention.  It creates another reason for the patients to keep coming back to you.         

There are, however, some things to be aware of if you are going to add batteries in a service package.  Offering a service package can be expensive.  Make sure you are accurately calculating out the cost of the batteries.  If you, in the past, have figured out that your average patient goes through X number of batteries, make sure you are looking at the newer aids and compensating for that.  Using our benchmarking tool a few years ago, we figured the average number of batteries a patient would go through was 27, and now it is all the way up to 36.  Make sure you are keeping in mind the true cost of the batteries in determining the service package you are going to offer.         

Also make sure that you are capturing your incremental patient.  If you have a patient that does not choose to buy the service package, make sure you still have a way to get that battery business.  When you are showing patients the service package, make sure you break out the components that are offered.  If you have a patient who is looking around at prices, they may see that your cost is higher than someone else's.  If you show them the cost of the service package and break it out, they can better compare and see that you are offering them an additional value with the batteries.  Otherwise, they generally assume that the price that you are showing is just the cost of the hearing aid, which can sometimes result in patients going elsewhere.           

Consider also that many new patients do not know the price of hearing aid batteries.  Once they understand the value of batteries in the service package, it will make them more likely to purchase this service from you.  And as we mentioned, it keeps them coming back to you for hearing aid maintenance, which is important for patient retention. 

If you are putting together a service package, make sure you have a system in place to easily identify the patients that have purchased this package.  You do not want your front office staff to give batteries to Mrs. Smith when she did not purchase the service package.         

When a patient comes in for more batteries, it may be marked on a calendar within their chart.  Documentation is an important step in ensuring that no one is taking advantage of the batteries that you are offering or giving them to someone else. 

Another direction you can take with batteries is to blend all three of these strategies – selling batteries, giving batteries away, and offering a service package - together to come up with the right solution for your office.  You do not need to choose only one option, sometimes it works better to combine them.  If you offer a combination, make sure you have the tools in place to manage it. 

Education       

Are you providing critical battery information to your office staff and patients?  Is your office educated on the current battery programs you offer, and do they understand how they are affecting the practice?  Your staff should feel like they are part of the success that you have, so make them an integral part in the process.  Also, does your staff have the necessary tools to help support selling the batteries?  They should be properly trained on the products they are selling as well as in communication with patients.  While you want to be the expert for your patients, if your front staff will be a touch point for your patients, you want to make sure your message is congruent across all members of your staff. 

As far as your patients go, do they know that you carry batteries?  The batteries should be accessible to the patient and in a place that can be seen as they are standing checking out or making their next appointment.  This will act as a visual trigger.  Do you provide business contact information via the Internet?  If you have a Web site for your patients you may want to market there that you carry batteries.  Offering batteries is also a great way to bring new patients into your office.  That is something that I hear all the time.  You never know when someone will walk in for batteries and end up having a positive experience and returning to your practice for other services.         

Partnering Up

Once you have decided the best way to incorporate batteries into your practice, one of the next most important things to do is select the right hearing aid-battery combination.  When evaluating products that you are going to sell, things to consider are: battery quality and performance, customer service, technical support and also marketing support.            

Quality and performance are critical.  We talked earlier about how reliability is the most important factor to patients. When we asked people what they thought were the most important attributes of a battery that influence their battery-purchase decisions, the top five reasons were reliability, high-quality, long-lasting, good sound quality, and if it does not leak.          

Notice that price is not even listed in the top five.  It is much more important to your patients that they get a reliable battery.  This is something I have brought up when I talk to offices that are fairly concerned about price.  You need to make sure that your battery partner also provides a quality battery and gives the performance that you need to go along with the hearing instrument products you dispense.          

There are other important characteristics to consider.  First is consistency of the voltage and battery life.  Some of the newer aids need 1.45 volts.  Other things include the risk of the battery leaking or rusting.  If you are in a high-humidity climate, that is definitely something to consider.  The country of origin can affect quality and performance.  Is it made in the United States or somewhere else? 

Service is the second thing that should be very important to you.  When you are selecting a partner, make sure that they have a dedicated service team that you can trust, and that your consultant is someone that you can rely on and feel comfortable with, and who you feel offers sound advice and opinions.       

When you are looking at battery suppliers, inquire about where their batteries are made.  If you need the batteries quickly, how long will it take for them to get to you?  Do you have to worry that if they are manufactured outside of the United States or if there is a natural disaster in another country that it is going to affect your battery supply?  I know that there some people who ran into that last year with the different natural disasters that occurred around the world.            

Also, who is really making the battery?  Are you buying from the manufacturer or from a third party?  This can also influence how quickly you are able to get batteries when you need them.  Talk with the company about the freight cost and the shipping procedures.  Some companies require you to purchase a large amount of batteries at one time to get free shipping.  This can affect your stock as you may end up carrying much more stock than you had planned on.  Be aware of the freshness of the batteries and if there are any hidden costs from the manufacturer. 

It is also important to trust the technical support from your battery partner.  Make sure your battery supplier has a technical team that is willing to work with you.  We have all had those times when one of our patients has a very unique need.  You want to have a technical support team that will know how a particular programming will work with a battery.  Pick a partner that has a history of manufacturing high-quality hearing aid batteries and is a leader in the industry.           

Ask the organization about their relationship with hearing aid industry and with device manufacturers.  Device manufacturers often consult with battery companies to see where we are going with batteries so that they can design their aids to be compatible with the batteries.  These two-way relationships are very important.  What device manufacturers are doing influences the development path of the battery technology, and the path of the battery influences the future hearing aid developments from device manufacturers.

When wireless technology was first was coming out in hearing aids, the hearing aid manufacturers approached the battery manufacturers and Rayovac was one of them.  Rayovac works with the device manufacturers, to ensure that the power is there for the hearing aids and the hearing aids can take full advantage of the battery.

The fourth thing to consider in a battery manufacturer is marketing that supports your practice.  How will your potential partner help to further develop your battery business?  Are they going to just give you a battery or are they going to help you actually develop your practice?  Do they provide extras for you such as battery patient brochures and racks, loyalty programs, battery club cards, patient referral cards and other retention tools?  You want a partner that will give you a competitive advantage when it comes to marketing and selling batteries, whether you are selling the batteries, providing them as a service package or giving them away.

The Rayovac Advantage

Rayovac delivers on all these critical measurements and provides superior products.  We have the world's longest lasting mercury-free hearing aid battery.  It is up to 40% longer lasting than those of our competitors.  We also now provide 1.45 volts on the battery, which meets the needs of the higher performance hearing aids and also powers up faster.

We are now on our second generation of mercury-free hearing aid batteries.  We have had them available for some time.  It is a common misconception that mercury batteries have been banned; many companies still offer batteries that contain a small amount of mercury within the zinc air batteries.  Mercury provides a critical role in that it keeps the battery from gassing and expanding.  As zinc and air interact to power the battery, gas is released as a byproduct.  If this is not controlled, the battery can bulge and break open. 

There are some batteries in the retail market that unfortunately have instances of this happening.  Some other companies’ mercury-free batteries actually have a very well-documented problem with this.  If it does not leak and it only bulges, it still creates a problem because it pushes the contacts of the battery compartment and bends them.  The next time you put a good battery in and enclose it, it is not going to make proper contact, and you will have intermittency in the aid.  Removing the mercury from batteries is complicated because of the gassing issue.  Rayovac has been able to manage the gassing issue with a proprietary agent so there is not any type of problem with gassing.

Since we have improved upon the first generation of mercury free batteries, the second generation is a superior product.  Rayovac is also recognized as the world's service leader.  We have a 96% customer satisfaction rating with our reps that are based here in the United States.  Furthermore, we have an entire division that only services the professional hearing aid market.  So when you work with Rayovac directly, the rep that you will be talking with only handles the professional market.  They are not going to be working with retail or any other types of drug stores.  The whole goal is to help professionals become educated on batteries, and to provide you with the best service possible.

Also, Rayovac supports professionals with technical expertise.  Our current hearing aid battery team is the most experienced hearing aid battery team we’ve ever had.  Some of our developers have been doing this since the introduction of zinc air batteries, which means they have nearly 40 years in the business.  Combined, our technical team has over 100 years of experience, so they know this product line better than anybody in the world.  A lot of people do not realize this, but Rayovac actually developed the size 10 battery. 

Rayovac stands behind our batteries.  As I mentioned earlier, we do offer a warranty, so that if our battery ever causes any type of damage to the aid, we will pay to repair that aid.  We have a great research and development team and we are always looking at areas to improve.   Our experts are very accessible.  The battery representatives within our department have been educated on many things and can spend hours talking about the technical portion of batteries.  But if it comes down to a question where we are really stumped, we have the whole research and development team very easily accessible to us.  Most of us are even in the same building.          

Rayovac also offers a very comprehensive business-builder program.  We have free customizable marketing materials for our Proline batteries, which is the battery available directly from us.  We have patient referral cards, and battery club booklets.  You’re probably familiar with battery club booklets - the patient buys the booklet in advance, then rips out the card and sends it in when they are ready for new batteries, and you just mail the batteries to them.  We also have battery club punch cards and note cards.  The list goes on.  If you have an idea of something you need, we are always looking to develop new business builder solutions for you.  We are very dedicated in being a partner, not just a battery supplier.

Summary

In summary, patient retention is very critical to the long term success of your practice.  Hearing aid batteries can be a tool to help strengthen your relationship with patients, to provide the services that they need, and also the solutions they need.  You can provide them a quality battery that they are not able to get in other places and increase your touch-points with the patients.  Whether you decide to give your batteries away, offer them as a service package or sell them, make sure that you can use them to create value for your patients.            

Also, choose the right battery partner.  You can have the best plans for how you are going to market batteries within your office, but if you do not have the right battery partner and you experience problems with shipments or quality, your battery program is not going to be successful.            

Rayovac is in the unique position to partner with you and help take your battery business to the next level. Please do not hesitate to contact us with any questions or needs. 

Thanks for attending today.