June 7, 2013 / 10:56 AM / in 5 years

Deutsche Telekom to open more shops as mobile market heats up

* To increase shops by 100 from 1,100 in next 18 months

* Hopes to lure in new customers as competition heats up

* Shops are viewed as important marketing tool

FRANKFURT, June 7 (Reuters) - Deutsche Telekom is to open more of its high street shops to fend off rising competition in Germany’s mobile market.

German consumers are catching up with the rest of the continent by switching to smartphones from basic mobiles, prompting Germany’s big four mobile firms to revamp their tariffs and boost advertising spending.

For Deutsche Telekom and its rivals, their shops are increasingly important marketing opportunities.

Deutsche Telekom currently operates 1,100 shops in Germany under the pink “T” logo, compared to Vodafone’s 1,600 shops and Telefonica Deutschland ’s 1,000 shops. KPN’s E-Plus/BASE brand has about 800 shops and plans more.

“Our goal is to add 100 shops in the next 18 months, with or without partners,” Deutsche Telekom’s head of sales in Germany Dirks Woessner told Reuters. Of its existing stores, 300 are operated as franchises.

Deutsche Telekom reduced shop numbers over the past three years and Woessner said the change of strategy reflected their renewed relevance.

“The shops are important to us as customers want to test our products and need personal advice,” Woessner said.

Late on Thursday Telefonica Deutschland opened a so-called concept store in Berlin as part of its new approach to introduce new media to its customers.

The futuristic-looking shop offers customers the chance to play games and participate in workshops and themed events as well as browse products and buy.

Although Deutsche Telekom has expanded to foreign markets, its home market is still key. Last year the former monopoly generated almost 40 percent of total annual revenues there.

It needs to shore up mobile services as its fixed-line broadband services come under increasing pressure. Cable providers such as Kabel Deutschland and Liberty Global are eating into Deutsche Telekom’s business by offering much faster internet connections at lower prices.

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