BT to start selling fridges and coffee machines

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BT is to start selling kitchen appliances such as smart fridges, kettles and coffee machines as the telecoms group looks for ways to boost growth and raise the profile of its consumer brand.

EE, the FTSE 100 company’s mobile and retail division, will sell the household electronic goods from next year in addition to the entertainment products such as laptops, cameras and smart TVs it already sells. EE also plans to expand its gaming, insurance and subscription services.

“Telcos aren’t as relevant, people are not thinking about their network provider . . . we are worried about it and want to do something different,” Marc Allera, chief executive of EE, told the Financial Times ahead of the launch of a refresh and marketing push for the EE brand.

The move comes shortly before Allison Kirkby takes over from Philip Jansen as BT chief executive and as the company continues a cost-cutting drive in an effort to revive performance. Its share price has fallen about a quarter over the past six months.

Allera said that “device as a service retailing” — in which physical products are sold alongside software subscriptions — was “a significant opportunity” for BT.

“We think we can do it better than other retailers,” he said, pointing to EE’s network of stores and UK call centres as well as a new online customer portal, which he said made it a good rival to online-only retailers.

“It is less about financials and revenue, than increasing relevance in the minds of consumers. If not, we risk being seen as a commodity service.”

EE currently provides insurance cover for some devices and plans to move into other insurance areas such as travel and home in the future. It is also going to launch a TV app to bring live channels to Apple TV 4K.

BT said EE had gone from zero to about 12 per cent market share for gaming consoles in the past six months. 

The cost of the marketing campaign of the new EE brand is believed to be in the high tens of millions of pounds, according to a person involved.

The consumer division was the biggest revenue driver for BT in the three months to June 30, bringing in £2.4bn or almost half of group revenue. In a shake-up last year BT said all consumer units would be moved under the EE brand.

Paolo Pescatore, founder and TMT analyst at PP Foresight, said the move was driven by the need to generate greater value among existing customers and attract new users. The consumer arm of BT has more than 25mn subscribers.

Allera had been tipped as the leading internal candidate for the chief executive role but BT announced in July that Kirkby would replace Jansen by the end of January 2024. She has been a non-executive director at BT since 2019, and is currently CEO of Sweden-based telecoms group Telia.

BT said in May it would cut up to 42 per cent of its workforce by 2030, equivalent to between 40,000 and 55,000 jobs. At the time the group said it had carried out £2.1bn in cost savings as part of a wider cost-cutting programme, progressing towards its target of £3bn.