Audi has opened a "digital" showroom on a major Berlin shopping street, part of a shift by luxury carmakers to display vehicles virtually as they move into smaller, pricier city centre locations to woo young affluent buyers.

The showroom, on Berlin's grand Kurfuerstendamm boulevard, is a quarter of the size of a conventional dealership and displays just four models. But it allows time-pressed customers to view and configure cars from Audi's full 49-model line-up on multi-media screens, without having to drive out of town.

It's a strategy also being embraced by German rivals BMW and Daimler's Mercedes-Benz as, after a six-year European market slump, carmakers overhaul sales practices and look for new ways to attract customers.

"Staging the brand is becoming so much more important," Audi's head of Germany sales, Wayne Griffiths, told Reuters.

The digital showroom, opened on Tuesday, is Volkswagen-owned Audi's third worldwide after openings in London and Beijing, and is close to Apple Inc and BMW stores.

Like its two German rivals, Ingolstadt-based Audi is faced with the challenge of displaying an ever-growing model and technology portfolio in urban centres where space is scarce.

Hence the smaller 375-square-metre showroom and the focus on virtual demonstrations, which are combined with the personal touch of a car dealer and the comfort of a customer lounge.

Audi is attracting 8,000 visitors a week to its digital showroom in Beijing which opened in January 2013, and at the store in London, launched in July 2012, 60 percent of customers are new to the brand, according to Griffiths.

Audi has pledged to overtake BMW as the world's biggest luxury carmaker by the end of the decade and shrank the sales gap with its Munich-based rival to 80,000 cars in 2013 from 85,000 in 2012. BMW outsold third-ranked Mercedes by 193,000 autos last year, compared with 220,000 in 2012.

While Audi still shuns internet-based deals, BMW is selling its new all-electric i3 city car over the Web and will also take online orders on the new i8 electric sports car, due to hit dealerships this spring, spokeswoman Birgit Hiller said.

"We're paying heed to changing buying habits," she said. "Expanding online sales to other models is conceivable, but there are no such plans as yet."

BMW has a series of brand stores in major urban areas such as Paris and New York and employs so-called "product geniuses" to help customers configure models online, Hiller said.

Mercedes-Benz has a goal of more than doubling its approximate 20 urban brand stores by 2020, when it also aims to retake the premium car sales crown from BMW.

The Stuttgart-based carmaker started online sales of compact models through outlets in Germany and Poland last December