From Pain to Profits
Retail locations worldwide: 3,000
US/Canada retail locations: 1,500
Specialty retail locations worldwide: 800
US/Canada specialty retail locations: 500
Continents: North America, South America, Australia, Africa, Europe
Strength of concept: A strong demonstration, a high profit margin, a large demographic.
Mission: To provide pain relief to consumers who suffer with chronic and acute body aches and stiffness with the use of federally tested and approved electrophysiology therapy massagers. Supported by strategic marketing, quality products and affordable prices.
Hi-Dow International, manufacturer and wholesaler of electronic muscle stimulators and accessories in
St. Louis, MO, taps its market like no one else—and makes it feel oh-so-good.
Stiff neck? Aching back? Throbbing feet? Look no further than a Hi-Dow RMU in your local shopping center. Hi-Dow manufactures portable, hands-free devices, known as TENS (Transcutaneous Electrical Nerve Stimulation) units that relieve pain by way of electrical pulses.
TENS therapy has been prescribed by doctors, physical therapists and chiropractors since the mid-seventies. Prior to Hi-Dow, however, “units were costly, frequently over $1,000, exclusively medical, available by prescription only, and the units themselves looked like bulky, obsolete devices,” says Bob James, company vice-president. “Hi-Dow changed all that by offering the therapy over the counter, dropping its price to a fraction of the original one and giving it a fun, modern look,” he says.
Think of a Hi-Dow muscle stimulator as a pocket massage therapist without the associated costs, says James. It also stands in as pocket acupuncturist. “As acupuncture involves stimulation of various pressure points, it is very successfully done by our products with electrical pulses instead of sharp needles. No side effects, no medication—smart pain relief,” says James.
Portability is a key benefit of the product. Devices are designed to take on a trip, to bring to work, to the gym, to the club, wherever anyone happens to be traveling, says Mike Tylec, sales manager. This way pain won’t dictate what someone does during the day, Tylec adds.
The first pulse
Eric Chen, owner of Hi-Dow International, first used a TENS unit during a visit to a physical therapist. With rising healthcare costs and a rapidly growing massage industry, Chen saw a niche in the market and decided to fill it. As owner of a medical facility in China, he knew he could successfully bring this product to market.
Starting in 1997, Chen spent five years developing the technology behind the product, manipulating electrical pulses to develop different settings with multiple therapeutic effects. The product was ready to promote in 2002. Hi-Dow began spreading the word through trade shows, and building a customer base with spas, salons, health stores and offices of chiropractors and physicians, says James.
Hi-Dow also showcased their devices in shopping centers throughout the Las Vegas area. “Specialty retailers were a part of our target market from the start, since the products are strongly based in demonstration,” says James. Today, over a thousand Hi-Dow operators are scattered across the country. “For the past three years, our sales figures have been consistently increasing, with an average of 25-30% per year,” says James. This trend is expected to continue this year. Company officials predict an increase of 30% or higher over last year due to stronger marketing efforts and new product introductions, says James.
As product evolution continues, new models emerge. Major product breakthroughs are coming soon, James promises. Innovation is key to success at Hi-Dow, so product designers come with strong technological backgrounds. Although competitors have since entered the specialty retail market, Hi-Dow remains the leader, says James. “We own our factory so there is no middle man. This gives us a key competitive advantage in the areas of supply, cost, and quality control. Our 11 years of importing experience along with our FDA medical device approval allow for a smooth importation process which translates to no inventory shortages for our retailers,” James adds. Further sharpening its edge, Hi-Dow expanded its operation in 2012 by joining forces with one of its largest customers, DNR Enterprises. Combining forces has created a stronger training department, says Tylec, who came on board with the merger. “Every one of our trainers has sold these products for the past 3-5 years,” he says.
Pain be gone
Hi-Dow units relieve pain by sending electrical pulses (120 per second, to be exact) through pads attached adhesively to the skin. These electrical pulses block pain impulses and the brain is fooled into thinking there is no pain. In addition, the units improve blood circulation, reduce inflammation, and relax muscles. Because Hi-Dow treats a large variety of chronic and acute body pain, as well as loosens tense muscles from stress or, say, before a tennis match, the target demographic for the products is vast.
Unlike other therapies involving the use of drugs, there are no side effects. Hi-Dow devices are “Medical Class II FDA approved,” says James. “FDA approval is necessary to legally market a medical device. Products without FDA approval may present health and safety risks for the user,” says James.
Having a variety of sensations to choose from is important on two levels. Number one, each user and the corresponding pain will react differently to the same sensation. For one user, a pulsing sensation will work best, for another, a kneading one, for another, a combination. Also, over time, muscles can de-sensitize themselves to a particular impulse.
Whether a unit offers six modes of treatment or 16, devices were designed with simplicity in mind. Once the unit is turned on, the desired therapeutic wave is selected and strength can gradually be increased as needed.
Simplicity is also communicated through packaging. Devices come in “iPhone-style boxes,” says James, clean, compact boxes that convey a modern, state-of-the-art image.
Retail ranges between $300-$600. The average markup is 800%. While this price tag might sound high for a common area product, Tylec emphasizes, Hi-Dow products are a fraction of the cost of a repeated comparable service, such as a visit to a chiropractor, massage therapist or acupuncturist, and customers are able to perform this service in the comfort of their own home, time and time again. Many accessories complement the models. Hi-Dow gloves, designed to target specific pressure points in the hand, are effective for carpal tunnel syndrome. “A silver fiber is woven into the fabric to make the surface area conductive,” says James. Hi-Dow sandals simulate pressure points in the feet. Ear clips, car chargers, splitters that take a four pad to a six pad and three sizes of adhesive, conductive pads round out the assortment. Pads are reusable but eventually need to be replaced.
Products come with a two-year warranty. “However, our customers can upgrade to a lifetime warranty when they purchase a VIP membership card,” says James. “Retailers can either sell the card to a customer as an upgrade or simply give it for free. It facilitates and maximizes sales figures,” says James.
Pulse the profits
Hi-Dow excels as a specialty retail product offering an “oooh” and “aaah” producing demo. “You can reach out to anyone. It’s a fun, interactive demo,” says Tylec. Customers are encouraged to try a free massage. Retailers identify where their tension is located, apply the pads and see which sensations they like best, says James. As pain dissipates and tension softens, “we explain what is happening,” says Tylec. “We show them how to use it themselves so they can see it is user-friendly,” he says.
When retailers come on board, the demo process, muscle disorder terminology, the science behind the pulses and the secrets to upselling, are all reviewed extensively. Training can be at a retailer’s location, at a Hi-Dow location, or through Skype. “It gives retailers a chance to have the whole staff there. All our retailers who have participated in the Skype training have seen a 30-50% increase in sales,” says James.
“We highly recommend Skype training at any time in order to increase sales, or when hiring new employees or raising sales figures with the existing employees. There is always room for growth. Our sales trainers can customize the right training for your specific employees according to mall clientele, age groups, etc.,” says James.
“We are also currently working on a training video which is going to empower our distributors to train old and new employees by the best techniques developed by our national sales trainers,” says James.
Retailers interested in getting started with Hi-Dow can dabble in the market before they jump in (although most operators carry Hi-Dow devices exclusively), with an opening order for as little as 36 pieces. This order includes promotional materials, such as 36 gift bags, brochures and flyers. There are no other hidden fees. “We offer all of the franchise benefits without a franchise fee,” says James. All orders include a detailed training manual as well.
Promotional materials are an important part of the marketing strategy at Hi-Dow. “We recently hired a marketing and project manager for the literature we hand out. We want customers to receive everything they can to give them satisfaction,” says Tylec. In addition, Hi-Dow remains active on all social media channels, such as Facebook, Twitter and YouTube, and sends regular emails regarding special offers, new products and industry updates, says James.
With decades of experience behind them, innovation at the forefront and an amplified marketing staff to deliver the message, Hi-Dow clearly has a “pulse” on the market.