Interview with Ragnar Åhgren, CEO, Comfort Audio
Topic: Design, Innovation and Assistive Listening Devices - Comfort Contego®, Comfort Duett®
SMAKA: Mr. Ahgren, thank you for your time today. Can you tell me about your background and how you came to work for Comfort Audio?
ÅHGREN: Yes. I'm a technical physics engineer. I started in engineering a long time ago producing radioactive nuclides for positron cameras. Approximately 20 years ago, I started working for a company called Transistor that manufactured hearing aids and assistive listening devices. That company was later bought by GN ReSound, so I worked there at first on the technical side of the business. During that time, I found my interest was turning more and more towards people, so I got involved in sales and marketing.
In 2002, I joined Comfort Audio because they were looking for someone with experience in this field and I thought they had very interesting and innovative products. Comfort Audio was founded in 1994 by August Pansell and Carljohan Lagervall, both engineers here in Halmstad, Sweden. They were introduced to this field when they discovered that there was a need for developing equipment for people with hearing impairments to use in work settings. They started a project to develop a system that utilized a microphone that could be placed on a conference table, and it would transmit all the voices around the table to a body worn receiver. This was first an infrared system, and later was developed utilizing another kind of transmission. When I first joined Comfort Audio, the turnover was 11 million Swedish kronas, or roughly $1.5 million US dollars, and there were seven employees. We doubled the turnover every second or third year from then on. Now we have 43 employees and our turnover is nearly $10 million.
SMAKA: That's an interesting mix of expertise that you have as a CEO - both in engineering as well as in sales and marketing.
ÅHGREN: As an engineer, I had always been interested in technical equipment. I was also a little bit shy in the early years [laughter] so I was comfortable sitting at a table working with a soldering iron, or with electronics, and then of course with computers. Early on in my career as an engineer, I thought you just had to have a good product, and then it would sell itself. But then I found out that's not true, you also need sales and marketing. And as I got more and more interested in meeting with and speaking with people, I gradually moved away from the technical side of the business in order to work with people.
SMAKA: What was responsible for Comfort Audio's huge growth in turnover in such a short time?
ÅHGREN: Two things were key to our growth. The first was the wisdom of our founders. In 2001, Pansell and Lagervall had to decide whether to continue running the company, or to continue running R & D. And they decided that the most interesting thing for them was developing new products. So, they wanted to hire a president or managing director to handle marketing, sales and running the company. And so they hired me for that, and I also became a shareholder. It was a very clever decision to have the founders and company owners in the R&D department, because then you know that you will develop really good products, and develop them quickly. And I think that was the first key to our success.
The other key was my contacts all over Scandinavia and across northern Europe. These are contacts that we continue to work with today.
SMAKA: How have Comfort Audio's products evolved since that first conference system was developed?
ÅHGREN: While our first system was infrared, we found disadvantages with infrared. Early on, we also developed some FM systems that were compatible so to speak with some other products on the market using the same frequencies here in Sweden. Then, we developed FM systems that used the European standard of 200 MHz. These products were still mainly being used by people in the workplace, and we began to see another need - FM systems for children in school. And these two main areas are still our focus today - developing products for people with hearing impairment in the workplace, and for students with hearing impairment in schools.
Children with hearing impairment in schools needed something more than just their hearing aids. They needed to be able to hear not only the teacher, but also the other children, and to be able to sit where they wanted in the classroom. So we developed products for this need.
At the same time, we also continued to develop and enhance our products for people in the workplace. From the 200 MHz system we then developed a digital communication system that has been tremendously successful and is sold here in the US. That's our Comfort Contego®, which is a wireless communication system, where the transmission is digital.
There are many benefits of a digital system. A very important benefit with a digital system is that it's not possible to eavesdrop, which you can do with an ordinary FM system. There are many situations where privacy is critical, such as with a lawyer who is hearing impaired and speaking confidentially with a client. With an ordinary FM system, you can pick up very easily on the conversation from outside the room. The same thing would apply to a doctor, for instance, who is talking with a patient. With Comfort Contego®, it is not possible eavesdrop.
Comfort Contego® is an audio streaming digital system and in that respect is somewhat similar to Bluetooth. Compared with Bluetooth, however, it uses very little power and also has no delay when transmitting. Especially for people with hearing impairments who use lip reading in addition to their hearing, it's very important to hear the signal at the same time you see the speaker's lips moving.
So those are just a few of the important technical benefits of Comfort Contego® as compared to ordinary analog FM systems, which have contributed to its rapid success both in Europe and the US.
SMAKA: The design of your products seems to set them apart from other assistive listening devices (ALDs) on the market. Can you talk about the design of Comfort Audio's products?
ÅHGREN: Yes, you're right. We focus on design because we think that an ALD should be almost like an MP3 player. It should look nice, something you want to have yourself. We really would like our products to look like they could be used by anyone, not just for someone with a special need or condition, and we've definitely achieved that. So design is very important for us.
SMAKA: When I worked in product management a few years ago we talked about "joy of use". We wanted products to be functional but we also wanted people to get excited about using them.
ÅHGREN: Yes, that's really true and we hear that about our products. In Denmark and Sweden there is a big focus on design in many industries. And even in these countries when people see a Comfort Audio product, they think, "That's really nice. How much is it?" And they ask this before they even know what the product is used for!
SMAKA: In addition to design, what are some of your goals as a company?
ÅHGREN: Well, it's important to note that we are focused on assistive listening devices and wireless communication systems. We are not focusing on hearing aids, but rather systems that can be used together with hearing aids, or in some cases instead of hearing aids.
Additionally, our goal is to continue to grow and double the turnover every second or third year, and we're aiming to be one of the leaders with this type of equipment.
SMAKA: You mentioned that sometimes ALDs are used together with hearing instruments and sometimes instead of. How should professionals be incorporating ALDs into their hearing care protocol?
ÅHGREN: Well, we know from statistics from Germany for instance, that maybe up to 30 percent of people coming into the audiologists' offices with hearing loss are leaving with no solutions for their hearing impairment. It is very important that professionals offer a range of solutions at all price points - from ALDs to a full range of hearing aids from entry level to premium. And in addition to optimizing communication, professionals can certainly profit from this equipment, and obtain and maintain customers.
The latest hearing aids have great technology. If you look at signal to noise ratio with hearing aids with the latest signal processing you can probably improve things on the order of +3 dB. With directional microphones in the hearing aids that could increase another +4 dB. But that doesn't make in total +7 dB;the signal to noise ratio improvement can be approximately 5 to 6 dB better with hearing aids alone. But if you add then wireless microphone systems, you can certainly have on the order of 15 to 30 dB better signal to noise ratio. That's impossible with just hearing aids.
If it's very quiet in the room, with only two people speaking, hearing aids work just fine. But as soon as you have background sounds for example from fans, or from other people speaking, it can be very difficult to hear with hearing aids. And noisy environments are much more realistic in today's world.
SMAKA: I had read an article where you said that people coming in to a professional's office don't have any preconceived notions of ALDs. So the professional doesn't have to deal with the obstacle of un-doing the consumer's negative perceptions.
ÅHGREN: That's exactly right, as compared with hearing aids. With ALDs you are starting from zero so they can be explained very easily.
Typically, consumers don't know what an ALD is. And you can tell them that it's not too complicated.
You can divide ALDs into two types of systems. Alerting or warning systems, like a loud doorbell or something to alert you that the telephone is ringing. That's the first type.
The second type of ALDs are for speech communication. They include wired systems, like special telephones, and wireless systems, like ours.
SMAKA: Comfort Audio has been very successful in Europe. Why did you decide to expand to the United States?
ÅHGREN: We saw a need for nicely designed products, and we knew that the US had a strong hearing instrument market. So we thought it would be worthwhile to see how our products would be accepted.
When we decided to move to North America, I was having a conversation with one of our export sales managers here in Sweden. And I just asked him, "What do think you would like to be doing in the future?" And he said, "Well, I like working in the United States." And so I said, "What do you think about taking your family with you and moving to the United States?" He said, "Wow - great!" [laughter]
So, that's what happened. Mr. Patrik Liljekvist then decided to move to the United States. For us as a company it was very good and has been one of the reasons for our successful start in this new market.
Another reason for our success is that we have some very special products that are different from other products on the market. There are no products like our Comfort Contego®, which is digital and has a focus on design. With this product, for instance, you can mix sound from the receiver and the transmitter. You have microphones in both the receiver and transmitter. You can then use the transmitter to transmit from your television, for example. You can sit on the sofa, and mix the signal from the television together with the sound from the microphone on the receiver, which is close to you.
We also have the Comfort Duett® a communicator which is more of a headset, and an amplifier that can also be used together with telephone and television.
SMAKA: Can you tell us what the differences are in this field in the US and Sweden? For example, I know in the United States only about 20 percent of people with hearing loss are wearing hearing instruments. Is that the same in Sweden?
ÅHGREN: I have seen figures indicating that in Sweden, about 400,000 people are using hearing aids. The total people with hearing impairment is roughly 1.2 million, so you could say two thirds are not using hearing aids. However, maybe some have only minimal loss or don't need hearing aids. There is an organization here in Sweden for hard of hearing, and they indicate that approximately 800,000 of those people need hearing aids. So that means that just half of the people who need hearing aids are actually using hearing aids.
SMAKA: That's more than in the U.S. Is there third party reimbursement for hearing aids in Sweden?
ÅHGREN: Yes, and we can see statistics from both hearing instruments and ALDs that if you have reimbursement in a country, you will sell more and penetrate the market more.
In Sweden, especially for people with hearing loss who are working, we have reimbursement for people to get the equipment they need to continue working. It's quite a lot - roughly $7,000 for one person - but that's cheap as compared to what it would cost the government if the person stopped working at an early age.
Also, we know that of the people with hearing impairment, more than half are below 60 65 years old, which is also very interesting. If you look at the various age groups in 10 year increments, the largest group of people with hearing impairment is age 55 - 65, and still working.
SMAKA: Do you find that people are more easily motivated to use ALDs now than in the past because of all our other gadgets in use today, like MP3 players and pagers etc.?
ÅHGREN: Yes, that's for sure. I think it is changing gradually, yes.
SMAKA: If professionals want to learn more about Comfort Audio's products, where should we direct them?
ÅHGREN: Comfort Audio is sold through distributors in the United States. More information can be found by contacting our Chicago office, or visiting www.ComfortAudio.us
SMAKA: We wish you much continued success and thank you for your time, Mr. Ahgren. Have a wonderful evening.
ÅHGREN: I wish the same to you. It's been very nice talking with you.