Türkiye’s only listed e-commerce platform Hepsiburada will prioritize profitability over rapid growth and step up efforts to retain customers who are being hit by soaring inflation.
Inflation in Türkiye hit a 24-year high of 85.5% in October, sharpening consumers’ focus on costs with increasing numbers turning to loans or credit cards to pay for more expensive goods.
Investor appetite for fast, and costly, growth has also waned as interest rates rise.
"My mandate here is to improve profitability," new Hepsiburada CEO Nilhan Önal Gökçetekin told reporters late Wednesday.
Gökçetekin said the path to improved profitability began with retaining customers through a company loyalty program. It also started offering quicker payment and new lending options late last year.
"We are the only e-commerce company that has a country-wide payment license," Gökçetekin said, adding that it plans to sell payment services to merchants outside its marketplace.
Hepsiburada also plans to further increase sales of more profitable non-electronic items, after their share of total sales rose two percentage points to 42% last year.
Gross merchandise volume, a measure of total online sales, rose 3.7% last year after the impact of inflation was stripped out, according to an earnings report released on Wednesday.
Order numbers grew 50% and active customers increased by 7.9% from 2021.
However, Hepsiburada’s net loss widened to TL 2.9 billion ($152 million) in 2022 from TL 2 billion a year earlier, while earnings before interest, tax, depreciation and amortization (EBITDA) narrowed to a loss of 2.6 billion from a 3.7 billion loss in 2021.
The company reports its results in inflation-adjusted terms as Türkiye is classified as a hyper-inflationary economy per international accounting rules.
It expects to break even at the EBITDA level in the first quarter, unadjusted for inflation, despite a contraction in demand after a major earthquake in February. That compares with a TL 7 million EBITDA loss in the last quarter of 2022.
E-commerce is still growing in Turkey. Gross retail sales increased by 114% to TL 4 trillion ($210.10 billion) last year, with e-commerce accounting for an 11% share, industry data showed.