Nuheara Limited (ASX:NUH) Co-Founder and CEO Justin Miller presents on the company's market positioning, rebound from COVID delays, the global market opportunity for smart hearing, sales channels and retail partners at FNN's Investor Event.
Nuheara is a audio hearables company. And with that, we've got exciting new products, but in doing so, developing a new category of hearing related products, which I'll touch on today. We'll set up the agenda for today. We'll give you a slight overview of who we are and what we do, the global market opportunity that's represented for us, and one that we're leading in, a bit of a business update as to how we're going into selling into that particular category, and obviously some contact details for anyone that has any further questions post today.
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So we were formed back in 2015 with a fairly simple mission and we're on the path to develop some smart, affordable and multi-purpose hearing solutions. We're pushing that into a particular part of the market that's not being served the traditional hearing solutions today.
And if we look at how we've actually positioned ourselves for growth into 2020, we've developed some world-leading products. Prototype, back when we first listed back in 2016 through to our third generation products, which is the IQbuds2 MAX, which was launched earlier this year at CES in Las Vegas, and ultimately won three awards across a range of different categories. But certainly as a third generation product, now we're primed for growth into 2020.
The market opportunity, very briefly, that's represented for us, is what we've deemed the $10 billion category. That's really flanking to more traditional sectors of the market, in traditional headphones space, but also the hearing aid and clinic market that effectively ignores the positioning that we've ultimately putting our products into, which is the mild-to-moderate hearing category. And ultimately extending that through a number of different opportunities and extending our business through government contracts, but also some very interesting OEM contracts that we've been able to develop over the course of time.
Competitive strengths; we've put a lot into our R&D. Australia's been a great place to do that R&D. We've invested heavily. We've developed these products. We've had these products in markets, so our R&D has actually gone hand in hand with having products out there. And I'm pleased to say that we've generated, not only millions of dollars of revenue, but millions of dollars of hours of people using our hearing products, and with that data developed even better products over the course of the last three years. And those three years, or four years, we've really gained a diverse hearing retail experience with new products that really started in more traditional retail, but now being pushed through direct-to-consumer. And given the COVID-related issues that we've faced, particularly over the last six months, that repositioning over the last 18 months has been a great benefit to us. To the extent that 84% of all our new sales are international and an even greater percentage of that are picked up on our direct-to-consumer online retail offerings.
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So how has it positioned us and how have we performed, more importantly, over the course of the last five years? As I said, we've gone from prototype to a third generational product in those five years. If I can point to really the financial year of 2019, where we really pivoted hard to hearing health and the direct-to-consumer offering, and in doing so, set out to get a higher selling price with the positioning of our second generational product, I'm pleased to say that, that repositioning, whilst it's taken some time, has seen our average selling price increase with a more sophisticated product, from ca. $200 to an excess of $400. So we've repositioned the product, we've repositioned our strategy, and ultimately chasing a high priced offering there.
As I said, we got off to a good start the last financial year and that was heavily impacted by what ultimately transpired with COVID. Effectively put a halt to our manufacturing, which is based in Malaysia. We had supply chain issues leading up to that out of China. And that really impacted us quite heavily over the course of the second half of our last financial year, but I'm pleased to say that we continued to take orders and in taking orders, and now being able to fulfill those orders, the business has got off to an incredible start in the current financial year. And I'm pleased to say that with what we've been able to invoice over July and August, we've actually exceeded the total of last year from a revenue perspective and are well and truly on track to outperform our best ever quarter, this current quarter.
I'll touch on it a little later, but we've also been quite active around, not only our own products and our hearing healthcare products, but also into our OEM opportunities, which is developing products and technologies for other customers.
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Very briefly there, a very experienced and independent board and a very experienced executive team that is now delivering hard on what we've been able to pull through over the last five years. Company saw to that $70 to $80 million market cap and recover well over the last few quarters, given the impact that COVID's had on, not only our business, but a number of businesses.
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The global market opportunity, and I'm going to touch on, although we could develop these particular products, it's developing a new category in the hearing space.
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And what is it? So what is our sweet spot? Well, essentially what we're trying to do here is position ourselves into a part of the hearing market that's completely underserviced today. And if we can show the next graphic, which highlights where we're actually attempting to positioning ourselves today. Traditional hearing loss market relies on clinical intervention, audiological intervention, and that does really well at the higher levels of hearing loss. Our positioning is, where about most hearing loss actually resides, is in the lower part of that particular segment. And 75% of all hearing loss in the mild-to-moderate category. And that's ultimately where we're attempting to position our multi-function product. More importantly, the average age of a hearing aid bearer is 72. Start losing our hearing from an age perspective at about 35. We're positioning ourselves into that mild-to-moderate category, which is representative of most hearing loss today, but not currently being serviced by traditional device.
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Very quickly, how do we fit in? Well, we're flanked by two very large, I guess, parts of the market. The $8 billion per annum hearing aid market to the right. That is a very high margin, low volume. So there's only 13 million devices sold annually at a very, very high price. They target a very specific part of that market. At the other end of the spectrum, we have the premium headphone market. A very low margin, but high volume part of the market. Similar sort of sizes. And from our perspective, we believe there's a smart hearing category, intelligent hearing, that offers multi-facets of different types of the technology and personalisation and customisation, that can ultimately deliver benefits from both sides of that chart and provide the high functional and high personalisation for a lot of customers that aren't actually able to, whether it's accessibility or affordability, achieve or obtain hearing assistance today.
An interesting part for us is that we see a big opportunity in the US. And the US has actually developed a new category of hearing aids, which was due to be implemented this year, but due to COVID, we will probably see that pushed out into next year. And that's an over-the-counter hearing aid solution. And we see significant opportunity in applying some of our technology into potential lower-end hearing aid offerings as well. So that's an exciting prospect for us to further enhance our business.
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So how do we fit? So we've got these techs that are out there today and if we look at trying to position yourself as a disruptor, you want to fit into that magic quadrant, which is that top left-hand part of the market. But for us, it's about also what we're not about. And that is the products that are represented in the lower portion of that chart we see here today; the Bluetooth headphones, Apple AirPods, personal sound amplification devices. They're low budget, but they're very low on hearing technology and customisations.
We're also not at the upper end. So the high budget, which involves a lot of dollars and a lot of time, and you need to get investment to reach out to particular hearing aids.
What we're about, is filling that gap. The smart hearing gap. So deliver maximum connectivity and hearing benefit conveniently and cost effectively. And we do that through the development of some proprietary technology that we're ultimately able to put into the earbuds... That I'm wearing today. I'm wearing the new MAX buds... That ultimately offer a lot of functionality, a lot of person personalisation for our particular customers.
So how do we do that? And what have we been doing to actually address that? A bit of a quick business update for you.
Nuheara really has two evolving parts of it's market. The first is the hearing healthcare part of the market and the second is the original equipment manufacture, where we're developing tech for other companies.
Next graphic. We look at the hearing healthcare side of the business. A lot of our business has been obtained now through our direct-to-consumer. We have seven global online Nuheara sites around the world and that's delivering hard for us, but we also have this online retail partnership. We actually have been physically located in a number of these stores. Best Buy Walgreens, big retail partners of ours, and have been with for a number of years. We're now repositioning ourselves into the online side of the business with them, given there's a lot of closure with a lot of those retail stores.
And then outside of that, we've also developed some government contracts that are giving us the ability to reach our customers through the UK and Australia. Significantly, our technology has come to the attention of a lot of major tech suppliers in the world. We had a recently announced collaboration with HP, that's in its infancy. The multi-million dollar, multi-faceted collaboration agreement that we'll see and be able to provide more updates on over the course of the next few quarters, but it's a very exciting prospect for us to deliver our technology in noncompeting type environments.
The Nuheara's DTC sales success. Bring up the next graphic please. Lastly, driven around our ability to reach our customers without the expense and the time that would necessarily have to be invested through traditional means. So what ultimately we can deliver in a number of days in the comfort of their own home, is taking someone in the more traditional sense, a lot more money and a lot more time. So from that perspective, there's a huge opportunity for us. 85% of our business has already been extracted from outside of Australia. So the growth potential is enormous for our business.
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We do that without going through each of these six phases, but there's a way that we're able to bring people in through social media, create online hearing assessments, deliver the devices to their own home, allow them to customise to their own hearing profiles, and then get the experience of what is a truly multi-functional hearing device, but also an entertainment headset as well.
Bring out the next graphic as well. So hearing healthcare from an online perspective. As I said, we've been working with these retailers for a number of years in the more traditional sense. We've now been able to pivot online. So what we've been able to experience through our own efforts, through reaching these consumers, we're now able to implement with a number of very, very large retailers and their membership base. And that's very important to us.
Push through all those actually, thanks. So moving our hearing retail online and throughout other stores. We'll move on to the next graphic, thanks.
Importantly, if I can have a quick summation here. Why Nuheara? We've launched as a first mover in a consumer hearing healthcare space that we've identified as being very, very large. And we're developing a new segment within that market that has its challenges, but we're now largely being validated by extensive customer data in a scalable, direct-to-consumer model. And we're pioneers in this particular part of the smart hearing space, which is as I said, appealing to two larger companies that perhaps haven't invested in the smart hearing space. And importantly, we're achieving growth in multiple sales channels. So we're not driven to our future success being reliant on one particular channel, there are multi-facets to how we're actually extracting revenue. So with that, that presents a significant global opportunity for us, and more importantly, a good opportunity from an investment point of view, as we continue to grow. Thank you for your time today. Appreciate it.Ends