Success factors of our business model
United Internet’s business model offers various benefits: the contractual commitment of our customers via fee-based, fixed-term subscriptions (over 25 million customer contracts at year-end 2020) secures long-lasting customer relationships and thus stable and predictable sales and earnings. In addition, our ad-financed free accounts (over 39 million at year-end 2020) provide a large reservoir for monetizing our applications via advertising and e-commerce as well as converting users to fee-based contracts.
Thanks to our existing business relationships with millions of customers and users, we have our ear close to the market. This often enables us to anticipate customer wishes and trends. We then consistently develop new business fields – at a national and international level.
We have already picked up a number of customer wishes and successfully transformed them into new solutions or new business fields:
- We meet the privacy demands of our customers with a variety of initiatives. Within the “E-mail made in Germany” alliance, for example, e-mails are automatically encrypted, while “De-Mail” and “eIDAS” also offer customers legally binding communication via e-mail in Germany and Europe. Our modern data centers meet the strictest security standards with largely geo-redundant operation, i.e., applications and data are constantly mirrored at geographically separate data centers.
- Our mobile internet products reflect the trend toward ever greater mobility in internet usage. A clear tariff structure offering great value for money and excellent service helps us achieve high customer retention rates and customer satisfaction, while securing a top-quality client base in a dynamic market environment.
- From our domestic market in Germany, our cloud and e-business solutions are now being marketed in new target markets as part of our internationalization strategy. As a result, the cultural diversity of our employees is also growing. The resulting potential for new ideas and innovation is strengthening our competitive edge and enhancing our long-term opportunities in future markets.
- For our Business Applications under the IONOS brand, all customers have the opportunity to contact a personal consultant free of charge as a central point of contact for all questions relating to products, their contracts, and their online businesssuccess. In this way, IONOS can accompany companies through all phases of their development – from registering a domain and setting up a first website, to setting up shop systems and dedicated servers, to using enterprise cloud infrastructures.
- Trust is the basis for our customer relationships. Data protection, operational reliability, 24/7 availability of our competent contact partners, and 24-hour replacement of defective equipment are all exemplary elements of the so-called 1&1 Principle which ensure customers can rely on us at all times.
Wherever it makes good business sense, we cover large areas of the value chain – from product development and data center operation, to effective sales and marketing, and active customer support.
Economies of scale represent a further key success factor for our business: each new customer enhances the profitability of our “Internet Factory”. After making the necessary investments, developing the products, and providing them via our data centers and networks, it is then a question of marketing them as effectively as possible. The greater the number of customers using products created by our development teams and run at the Group’s own data centers, and/or data transported in our own networks, the greater the profit will be.
A further advantage is our marketing strategy tailored to specific target groups. Our brands such as GMX, Mail.com, WEB.DE, 1&1, yourfone, smartmobil.de, IONOS, STRATO, united-domains, and InterNetX are positioned differently and target a wide variety of user groups.
Last but not least, the exportability of our applications is a further trump card. Our applications can often be used anywhere in the world and work on the same principle in Frankfurt as they do in London, Paris, or New York.