Turkish E-commerce Ecosystem Outlook

Players need to address key questions to identify growth opportunities and stay competitive in the highly dynamic market

Key questions to define the growth path

1

How should you define yourway-to-play in the «Super App» transformation in order to protect and increase your enterprise value?
2

How can you furtherstrengthen your incumbent position in your top categories and verticals?
3

What would be the ideal journey and timeline to introduce new services?
4

Which additional value-added services can you provide throughout the buyer’s journey, as well as in merchant relations?

5

Which capabilities should you build or strengthen to deliver your expanded value proposition, and how? i.e. organic, acquisition or partnerships.
6

What will be the implications on the operating model and organization structure?
7

How can you better set growth targets and manage the performance of initiatives – e.g. OKRs?
8

What will be top-line impact of your new strategy and how will your 5-year P&L look like?

Turkish E-commerce market significantly grew in the last two years and is expected to maintain its high-paced growth

Turkish E-commerce market outlook

COVID restrictions throughout the year have resulted in an significant growth in demand in 2020.
Increased adoption of E-commerce solutions by the sellers and permanent changes in consumer behavior will push the market towards 400-450 billion TRY levels in 2026, to exceed 22% penetration in total retailing.
Online shopper base is expected to reach 45 million in 2026 and represent more than %70 of the total addressable population^₂_.

^{1) E-commerce market definition includes sales of goods on online marketplaces and online channels of omnichannel retailers, excludes travel & transportation, sports betting, gaming, B2B and cross-border sales, excludes VAT

2) People aged between 16 to 74 represent the total addressable market for online shoppers

Source: ETBIS, TUBİSAD, TÜİK, BKM, Strategy& Analysis}

Marketplace players gain larger share in the market, which encourages other online players to form marketplaces as well

Shifting market structure of the Turkish E-commerce

Marketplaces offer a wider range of SKUs with a pure&hybrid 1P-3P²business model compared to omnichannel retailers whose primary sales channels have been brick and mortar historically.
Turkish retailers are considering forming their own marketplaces to capture their share of the boosting market.
Moving forward, share of marketplaces is expected to increase in 2021 and beyond.

^{1) Gross Merchandising Value generated by marketplaces as a percentage of total E-commerce market

2) 1P refers to first party direct sales where a marketplace sells a pre-supplied and stored product to customer, 3P refers to third party sales where merchants list and sell products on a marketplace platform

Source: ETBIS, TUBİSAD, TÜİK, BKM, Strategy& Analysis}

Volume increase and evolving customer needs make delivery a must-have capability for competitiveness

Challenges and opportunities in last-mile delivery market

1

Bottleneck Created by Growing Demand for E-commerce

2

Investments by Big Players to Improve Service

3

Opportunity for New Entrants With the Growing Demand

4

Innovative Logistics Solutions by E-Comm Players

Growing market and increasing competition drive many players towards forming «Super Apps»

Overview of emerging Super Apps*

1

E-commerce (Marketplace & Instant Delivery)

2

Banks & Telecom Operators

3

Traditional Grocers

4

Public Sector Entities

5

Loyalty Programs

Players’ priority will be to seize the growing opportunity moving forward

Key takeaways

1

Marketplaces’ Increasing Presence

2

Payment Focus

3

New Models in Delivery

4

Emergence of «Super Apps»

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Turkish E-commerce Ecosystem Outlook

Turkish E-commerce Ecosystem Outlook

Players need to address key questions to identify growth opportunities and stay competitive in the highly dynamic market

Key questions to define the growth path

Turkish E-commerce market significantly grew in the last two years and is expected to maintain its high-paced growth

Turkish E-commerce market outlook

Marketplace players gain larger share in the market, which encourages other online players to form marketplaces as well

Shifting market structure of the Turkish E-commerce

Volume increase and evolving customer needs make delivery a must-have capability for competitiveness

Challenges and opportunities in last-mile delivery market

Bottleneck Created by Growing Demand for E-commerce

1

Investments by Big Players to Improve Service

2

Opportunity for New Entrants With the Growing Demand

3

Innovative Logistics Solutions by E-Comm Players

4

Growing market and increasing competition drive many players towards forming «Super Apps»

Overview of emerging Super Apps*

E-commerce (Marketplace & Instant Delivery)

1

Banks & Telecom Operators

2

Traditional Grocers

3

Public Sector Entities

4

Loyalty Programs

5

Players’ priority will be to seize the growing opportunity moving forward

Key takeaways

Marketplaces’ Increasing Presence

1

Payment Focus

2

New Models in Delivery

3

Emergence of «Super Apps»

4

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