Turkey’s soaring population growth, urbanisation and increasing household expenditure has lead to an increase in purchasing power, with positive results for the local retail industry. In comparison with Europe, Turkish retailers are expected to post improved five year revenue performance with an average growth rate of 9% year on year, ranking it among Europe’s top 10 in consumption expenditure.

Furthermore, freshly organised retail structures and an expanded acquisition and merger sector, especially in food retail, have rewarded Turkey with particularly high growth in overall retail. This is supported by the rise of small and medium sized retailers who have merged and subsequently expanded.

In contrast to Turkey’s growth, in 2016 Europe faced numerous challenges, ranging from political and social upheaval to a humanitarian crisis that shocked the world. Nevertheless, Europe’s economy and consumption proved resilient enough to weather the storm. In real terms there has been positive growth in consumption, leading to steady successes in the retail sector. Specifically, Central and Eastern Europe is on course to achieve strong increases in real purchasing power, while Southern Europe is experiencing a steady increase in disposable income, contributing positively in terms of retail growth.

Although it can be stated enough that there are regional variations in Europe’s purchasing power which cannot be equally distributed, in general, European retail consumption demonstrated stability and confidence that consumers are willing to cover more than just their basic needs. 

Turkey’s offline-to-online retail strategy

Successes in Turkish retail should not only be associated with B2B, but also with e-commerce businesses which trade locally and internationally. “Temporarily, some  retailers have had difficulties in maintaining physical traffic to their retail units sometimes. This has led them to invest in their online platforms, with wide scale recruitment of category and product managers, alongside distribution and logistics professionals throughout the retail sector,” Ezgi Guneser, PageGroup Manager Turkey, explains.

As online retail gains have gained more importance in Turkey, they have helped in the development of strong trends in the sector, especially as regards online strategies which aim to boost consumption.

“We can see investments on customer segmentation,” Guneser continues, “via increasing loyalty, new customer generation via strong CRM, and in-depth analysis of big data. There are applications collecting customer behaviours for different brands, creating specialised campaigns and providing companies data on customer behaviour.

“A manager in a Turkish retailer with a noticeable market share informed me that they are consolidating online & offline data. By this he meant that their specialised CRM team is focusing on the baskets of online customers who do not proceed to checkout, and creating special SMS campaigns on those missed products to invite them physically to their stores,” Guneser concludes.

One consumer, one retailer: from multi-channel to omni-channel retail

The future of Turkish retails lies online. By 2020, Turkish consumers are expected to view each retailer as permanently accessible single brand, without distinction between the virtual and real world. Multi-channels will turn into omni-channels as retailers try to build up one-on-one relationships with consumers through digital platforms.

These personalised strategies will be highly supported through advanced CRM and SMS trends, which can be observed on the Turkish retail market. In this way, physical and virtual stores merge together with digital tools, enabling Turkish consumers to purchase anywhere, anytime with the feeling of a personal relationship with retailers, regardless of external conditions or circumstances.

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Summary

1. Retail in Turkey and Europe: Overview 2. Turkey‘s offline-to-online strategy 3. One-to-one retail as a future trend