More On Starkey’s Costco Deception

We have now received the third confirmation Starkey is selling their hearing aids in the 10 South Korean Costco dispensing locations, at least up to May of 2014 — And significantly after Bill Austin publicly said he wouldn’t. What’s more, the company appears to have put in place internal controls to deceive many of their own employees, including at least one audiologist we highly respect.

Costco South Korea Starkey brochure 4-24-2014

Note the April 24th — May 5th 2014 dates for the sale in the navy blue band on the right on the right
Click to enlarge in a new window

June 26th 2015 Update: One of our South Korean readers we asked to investigate wrote us the following:

I went to ILSAN Costco’s hearing aid center. And I asked an employee who works in a hearing aid center about Starkey brand. She told me that they don’t sell Starkey brand anymore because of margin and hearing aid problems. I didn’t asked what kind of problems… I hope it helps to you. And I tried to take a picture but a security was watching me. So I couldn’t take a pic.

After receiving a tip e-mail at AudiologyNow containing three recent photos of the Starkey displays at a Costco in South Korea, confirming the image of the earlier brochure from 2012, we published Starkey Caught Red-Handed Selling In Costco on Thursday evening, March 26th, as we use journalism’s “two source rule” before breaking a story. Reaction was both swift and strong, and it generally fell into one of five categories:

  • Not Surprised, as it’s Bill Austin we are talking about;
  • Big Deal — Costco Korea is not my competitor;
  • Our information was old (seeing only the original 2012 brochure posted by a rehab center and ignoring the three recent photos);
  • Not denying the story but saying what a great guy Austin is for hanging free BTE’s in the jungle photo ops (and spending a lot of money to make sure everyone knows it);
  • Why does ReSound get a pass for selling in Costco? (They don’t; and we are putting the finishing touches on how they badly bungled the LiNX² rollout).
  • In addition,  several Starkey employees, including a vice president, unfriended us on Facebook.

However, what is distressing is that it appears Starkey has put in place internal controls to deceive even its’ own employees, to establish a veneer of “plausible deniability:” A very dear friend of ours is a sales audiologist for them, and she told us that she could find no record of Costco SoKo in their system. We have no reason to doubt the truthfulness of our friend, as this points to an internal information quarantine at Eden Prairie so that only employees who have a “need to know” can see it… And disturbingly, placing the remainder of their employees, including several other dear friends, in a compromised position as they can deny this, believing they are being truthful.

To be clear, our position at The Hearing Blog is that it’s actually A Good Thing that Starkey is selling in the SoKo Costco stores, as American exports means American jobs; and when you cut out all of their legendary marketing hype Starkey actually builds decent hearing aids for the money. However, a fish rots from the head down; and it was Bill Austin’s Holier-Than-Thou attitude and concomitant deception last March that we, as well as many others in the hearing care industry, find obnoxious~

 

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About the author

Dan Schwartz

Electrical Engineer, via Georgia Tech

5 Comments

  1. Paradise Hearing
    April 7, 2015 at 12:47 pm

    It is a shame when people say they will do one thing but then do the other. This is especially bad since it has to do with health and hearing. Thanks for sharing and hopefully it is corrected.


  2. Paul
    July 3, 2015 at 11:20 pm

    So is that North or South Korea as the price would be either $150 or $1500 depending which.
    I assumed South but that is $150


    • Dan Schwartz
      July 4, 2015 at 12:28 am

      South Korea. We don’t think Costco is in Pyongyang!


    • Caleb
      September 10, 2015 at 6:15 pm

      Coupon for ~$150 off, not sales price


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