Managing Asia

Managing Asia

Sennheiser Group continues long history of audio industry innovation with 3D, VR products

Sennheiser takes on the digital revolution

From the guitar riffs of Led Zeppelin to the fresh, deep house tunes of German DJ Robin Schulz, music drives Andreas Sennheiser.

The Sennheiser Group co-CEO's passion for an eclectic mix of old and the new is also reflected in his commitment to maintaining the legacy of the 71-year-old family business, while staying on top of audio innovation.

One of the world's leading makers of high-end audio equipment, the privately-owned German group was founded by Sennheiser's grandfather, Fritz Sennheiser, and was run by Fritz's son Jorg, before Sennheiser and his brother Daniel took over as co-CEOs in 2013.

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"We are very different in terms of where we came from," he tells CNBC's Managing Asia.

Sennheiser, who has a doctorate in Supply Chain Management from the Swiss Federal Institute of Technology, sees himself as a "very precise person." Daniel, an industrial designer, is a complementary creative force.

But despite Sennheiser's engineering background and love of music, he did not begin his career in the family business. Instead, he worked at a Liechtenstein multinational before signing up at Sennheiser Group in 2010.

"You have to cut your teeth somewhere in a neutral calibrate your ego," Sennheiser reckons.

Asia is a high-growth region for the company. In particular, India's rapidly expanding middle and upper classes have driven an average of more than 45 percent growth a year. China, South Korea and Australia are also regarded as strong markets.

However, the same regions have attracted the attention of Sennheiser's rivals, including Sony, Beats and Bose, so in an ultra-competitive audio equipment market, innovation is key to Sennheiser, the co-CEO says.

Part of the group's strategy involves a shift from a linear mode of thinking to a more "iterational" one. For instance, customer input is consulted during product development and customers are frequently engaged in the creation of new prototypes.

While this is a more unwieldy method of production than bringing a finished product straight to market, benefits exist.

"[This] is very good for us [because] we get first-hand insights from what customers actually expect from us," Sennheiser says.

A pair of Sennheiser Momentum 2 headphones, taken on April 17, 2015.
Jonny Gawler | MacFormat Magazine | Getty Images

Another consumer trend is the growing importance of aesthetics to customers. Headphones that offer perfect sound are no longer enough; customers want a multi-sensorial product, complete with genuine leather and stainless steel, he says.

"It's not just a product you listen to but an expression of yourself and your style," Sennheiser explains.

As a result, the company places heavy emphasis on research and product development, with about 7 percent of the company's turnover plowed back into R&D.

Sennheiser says that doing so preserves the "research spirit" that his grandfather possessed; Fritz, who died in 2010 at the age of 98, won numerous awards for the innovations he brought to the audio industry, including being honored at the 1987 Oscars for creating the MKH 816 shotgun microphone.

"We have a creative dissatisfaction in our culture with everything that exists, so the status quo, as soon as we've created something, it's no longer of interest because we know how it's done. [We want to] go to the next step," he says.

In the pipeline for the inventive company are new technologies that aim to give customers a "truly immersive experience." Sennheiser highlights what the company calls "AMBEO 3D Audio Technology," which is a suite of 3D audio solutions. It's also developed virtual reality (VR) microphones that are already being promoted as the standard for VR production.

Sennheiser says that he hopes to keep the company at the forefront of the audio industry, even if pushing into unchartered territory comes with more risk.

As Sennheiser says, "We want to leave new steps in the fresh snow."

CORRECTION: The article has been updated to reflect the name of Sennheiser's audio technology.

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