1&1 Bundle
Who are 1&1's customers?
Understanding customer demographics and target markets is paramount for sustained business success. For 1&1 AG, a major German telecommunications provider, a pivotal demographic shift and strategic product launch have significantly impacted its trajectory: the ambitious rollout of its own 5G Open RAN mobile network.
This initiative, which began with the launch of mobile services in late 2023 and an intensified migration of millions of existing customers in early 2024, signaled a profound evolution from its Mobile Virtual Network Operator (MVNO) model, directly challenging established players in the German market.
As of June 30, 2025, 1&1 AG served 16.33 million customer contracts. This figure shows a slight decrease from 16.39 million at the end of 2024, with broadband connections seeing a decline while mobile communications remained stable. The company's strategic shift to becoming a network operator necessitates a deep understanding of its customer base, which can be further explored through an 1&1 PESTEL Analysis.
Who Are 1&1’s Main Customers?
The company's primary customer segments in Germany are private households (B2C) and small to medium-sized businesses (B2B). As of June 30, 2025, the company had 16.33 million customer contracts, with mobile internet contracts making up the largest portion at 12.44 million. This highlights a significant focus on mobile services for its consumer base.
B2C Customer Focus
The B2C segment targets a wide range of individuals and families seeking affordable and dependable mobile and broadband services. These customers often look for comprehensive packages that include features like unlimited data and all-net flat rates for mobile plans.
B2B Customer Solutions
For businesses, the company provides cloud-based applications and robust telecommunications infrastructure, leveraging its affiliate's fiber-optic network. This segment caters to small and medium-sized businesses needing stable internet, mobile communications, and related digital solutions.
Contract Growth and Trends
In fiscal year 2024, customer contracts grew by 130,000 to 16.39 million, primarily driven by new mobile internet contracts. While broadband connections saw a slight decrease, the overall growth indicates a strong performance in the consumer access market.
Market Positioning
The company also serves price-sensitive consumers through its discount brands, which have received positive ratings in industry tests. The ongoing development of its own 5G network further enhances its ability to attract and retain customers who require high-performance connectivity.
1&1 Company Profile Insights
The company's customer segmentation strategy effectively addresses diverse needs within both the consumer and business markets. Understanding these distinct groups is key to appreciating the company's Revenue Streams & Business Model of 1&1.
- The B2C segment values comprehensive packages and competitive pricing.
- The B2B segment requires stable infrastructure and cloud-based applications.
- Mobile internet contracts represent a significant portion of the total customer base.
- The company's expansion into its own 5G network aims to meet growing demand for advanced connectivity.
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What Do 1&1’s Customers Want?
1&1 AG's customers are primarily driven by a need for reliable, high-speed connectivity and competitive pricing. For mobile users, seamless connectivity and all-net-flat rates are paramount, especially with the ongoing migration to their own 5G network. The company's commitment to quality is highlighted by its 'very good' rating in the 2024 connect test for mobile hotlines.
High-Speed Connectivity Needs
Broadband customers seek stable and fast internet for home networks, online storage, telephony, smart home applications, and IPTV. Leveraging its own fiber-optic network and partnerships, the company aims to provide future-proof fiber connections.
Demand for Unlimited Data
Mobile users expect seamless connectivity and features like all-net-flat rates and unlimited data. This caters to heavy data users who rely on their mobile devices for a wide range of activities.
Importance of Network Stability
Service disruption, as experienced with a temporary outage in May 2024, underscores the critical importance of network stability for customer loyalty. Smooth migrations are key to retaining customers.
Value and Customer Experience
To foster retention, the company emphasizes value and customer experience through initiatives like the '1&1 Service Card'. This offers premium services such as 24-hour device replacement and a dedicated priority hotline.
Adapting to Market Trends
Product development is influenced by market trends, with ongoing investments in 5G and cloud computing. This ensures the company meets evolving demands for next-generation technologies.
Diverse Product Portfolio
By offering a diverse product portfolio, including discount brands, the company tailors its offerings to different segments. This ranges from those prioritizing affordability to those seeking premium, feature-rich services.
The company's approach to customer needs and preferences is multifaceted, aiming to provide both essential services and enhanced value. Understanding the 1&1 customer demographics reveals a market segment that values reliable infrastructure, competitive pricing, and responsive customer support. The company's strategic investments in its own network infrastructure, including the expansion of its 5G mobile network and fiber-optic broadband, directly address the core needs of its user base for high-speed and dependable connectivity. Furthermore, the emphasis on premium services like the 24-hour device replacement and priority hotlines indicates a focus on customer retention and satisfaction, aiming to mitigate potential churn caused by service disruptions. This strategy aligns with the broader Growth Strategy of 1&1, which involves building out its own infrastructure to gain greater control over service quality and customer experience. The company's ability to cater to different market segments through a varied product portfolio, from budget-friendly options to more comprehensive packages, further demonstrates an understanding of diverse customer preferences.
Key Customer Preferences
Customers prioritize reliable, high-speed internet and mobile connectivity. They also value competitive pricing and comprehensive service packages that meet their digital lifestyle needs.
- Seamless mobile connectivity and all-net-flat rates.
- Fast and stable broadband for home use, including IPTV and smart home applications.
- Premium customer service features like 24-hour device replacement.
- Value for money across a diverse product portfolio.
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Where does 1&1 operate?
1&1 AG's geographical market presence is predominantly focused within Germany, with its headquarters situated in Montabaur. The company maintains additional offices in key German cities such as Karlsruhe, Munich, and Berlin to facilitate customer and partner engagement across various economic regions.
German Market Focus
The company's primary operations and brand presence are concentrated within Germany. This focus allows for tailored services and marketing efforts to meet the specific needs of the German consumer base.
Network Expansion in Germany
1&1 is actively developing its own 5G mobile network across Germany, with ambitious targets to cover 25% of German households by 2025 and 50% by 2030. This initiative aims to enhance its market position and brand recognition nationwide.
The company's strategy involves leveraging regional networks and broadband household lines from city carriers, in addition to those from Deutsche Telekom, to ensure comprehensive broadband coverage across Germany. This includes VDSL, vectoring, and fiber internet services. A significant development is the national roaming partnership with Vodafone, initiated in August 2024, which is set to be available to all 1&1 mobile customers by the end of 2025. This partnership is designed to gradually reduce reliance on previous roaming agreements and improve overall network quality and coverage for its users.
Mobile Network Strategy
By the end of 2025, over 10 million customers are expected to be migrated to the 1&1 O-RAN mobile network. This transition signifies a move towards greater control over service delivery and an improved customer experience.
Addressing Regional Differences
1&1 addresses varying customer preferences and purchasing power across different German regions through broad market coverage and targeted marketing campaigns. This approach utilizes both its primary brand and various discount brands to reach diverse customer segments.
Vodafone Roaming Partnership
The national roaming partnership with Vodafone, launched in August 2024, is a key strategic move. It aims to enhance network quality and coverage for 1&1 mobile customers across Germany, improving their overall service experience.
Broadband Infrastructure
The company ensures nationwide broadband coverage by utilizing regional networks and broadband household lines from city carriers, alongside Deutsche Telekom's infrastructure. This strategy supports the delivery of VDSL, vectoring, and fiber internet services.
Customer Migration
A significant customer acquisition strategy involves migrating existing users to the company's own mobile network. This is a crucial step in the Brief History of 1&1 as it builds its independent infrastructure.
International Mobile Services
While its primary focus is Germany, 1&1's mobile services are accessible internationally through roaming agreements. This allows its German customer base to utilize their services while traveling abroad.
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How Does 1&1 Win & Keep Customers?
The company focuses on attracting and retaining customers through substantial marketing investments, a wide array of products, and superior customer service. In the first half of 2024, there was a notable increase of 90,000 customer contracts, bringing the total to 16.35 million by June 30, 2024, with a particular emphasis on mobile internet contracts.
Marketing and Brand Visibility
Intensified advertising campaigns, especially following its establishment as Germany's fourth network operator, are key. The company employs broad market coverage and tailored marketing for its primary, co-branded, and discount brands to reach diverse customer segments.
Customer Engagement and Sponsorships
Digital channels are paramount, complemented by sponsorships like the partnership with Borussia Dortmund. This collaboration aims to develop new social media content and boost brand recognition, contributing to the overall 1&1 company profile.
Customer Retention Initiatives
The '1&1 Principle' and '1&1 Service Card' offer premium benefits such as 24-hour device replacement and priority hotlines, fostering customer loyalty and satisfaction.
Product Innovation and Network Migration
Continuous product innovation, including unlimited data plans and cloud services, keeps customers engaged. The ongoing migration of over 12 million mobile customers to its own 5G Open RAN network, started in January 2024, is a significant retention strategy.
The migration to the new 5G Open RAN network, while aimed at enhancing customer experience and reducing third-party network reliance, has presented challenges. A temporary network outage in May 2024 led to an increase in customer churn, underscoring the critical need for seamless transitions and robust infrastructure to maintain customer loyalty and maximize lifetime value. Despite a slight rise in terminations linked to this migration, the company anticipates a stable contract base for 2025. Understanding the 1&1 customer demographics and the 1&1 target market is crucial for navigating these strategies, especially when considering the Competitors Landscape of 1&1.
Targeted Marketing
Utilizing broad market coverage and specific campaigns for different brands ensures appeal across various customer segments, from premium users to those seeking value.
Enhanced Service Offerings
Premium services like 24-hour device replacement and priority hotlines are central to the '1&1 Principle,' aiming to boost customer satisfaction and loyalty.
Network Infrastructure Investment
The migration to a proprietary 5G Open RAN network is a strategic move to improve service quality and customer retention by offering a superior network experience.
Brand Visibility through Sponsorships
Partnerships, such as with Borussia Dortmund, are leveraged to create engaging social media content and increase overall brand visibility, contributing to the 1&1 customer acquisition strategy.
Product Diversification
A continuous stream of innovative products, from all-net-flat rates to cloud-based applications, is essential for maintaining customer engagement and reducing churn.
Addressing Migration Challenges
The company actively manages challenges arising from network migration, such as temporary outages, to minimize impact on customer loyalty and the 1&1 user demographics.
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