Digital - 2022 General Overview
2022 was a year of transformation for Sabancı Group’s digital business. Aiming to create a global player in the digital world by focusing on business models based on next generation technologies at Sabancı Group, Dx Technology Services and Investment BV (Dx BV) was established in the Netherlands. Sabancı Holding is the sole and founding shareholder of this entity. In 2022, Dx BV invested in Radiflow and SEM, among the best companies in the cyber security and digital marketing sectors respectively, to accelerate growth and value creation of these rising stars.
In May 2022, Teknosa.com introduced a refurbished cell phone category in marketplace featuring a wide selection of high-quality professionally restored and guaranteed devices. In addition to the environmental benefits of reducing electronic waste, purchasing a refurbished cell phone from Teknosa digital channels offers consumers a financial advantage.Product rental is another service that the Group’s tech retail company provides as an affordable and sustainable alternative in which consumers can rent and try out nearly 200 products via Teknosa Marketplace before making a purchase decision.
As a part of the service business, Tekno Hizmet was launched in early 2022. Service and membership packages were developed to fulfill customers service needs for all their technology products. Membership packages fulfill every consumer need related to installation and support, protection, repair and care of products purchased from the Group’s tech retailer. In a short time, Tekno Hizmet has achieved its mission of reaching out to more customers, including non-Teknosa consumers.
Private label (Preo), one of the Sabancı Group tech retailer’s strategic initiatives, was enhanced via a product portfolio expansion across five categories with more 1,000 stock keeping unit (SKU)s. Development of various new high-tech and higher-average sales price (ASP) products – such as TVs, tablets, and smartwatches – enables Teknosa to meet consumer needs while also boosting the profitability of this business. Outside of Teknosa, private label market penetration was maximized by strengthening alternative channels with over 50 different external companies.
Protect and Grow the Core
This year, Teknosa, Sabancı Group’s technology retailer, embarked on a comprehensive initiative to improve its customer journey to create a seamless and flawless phygital experience to consumers with a new experience-based store concept. Stores will increasingly become critical touchpoints for customers while achieving operational efficiency through digital transformation. Digital screens where customers can look-up product information and compare them, interactive cash register screens that greets and display basket contents of the customer and campaigns, digital tags and product experience areas enable customers to feel a smooth transition between online/ offline channels and enhance phygital experience. Several product experience areas are placed for customers to be immersed in a warm, home-like mood. These stores are made accessible to all visitors through pathways, wheelchair accessible checkout points and easy-access buttons. Separately, a “Sustainability Wall” installed in stores displays energy-savings, carbon footprint and recyclable waste information for customers.
To boost its service ecosystem and become a “one-stop-shop” for customer tech-related needs, Teknosa’s after sales services, branded as Tekno Hizmet, were consolidated into a single contact point for customers to navigate easily.
In 2022, Teknosa also introduced new features on its web and mobile app platforms, including live web and video chat support, and a smart product search robot. The experience-based design of the channels uses physical store and online footprint data in addition to AI.
With these new investments, Sabancı Group expanded its global presence in the digital arena, doubling the number of customers served with a footprint in 60 countries and offices in five countries. Targeted investments and professional development programs helped the Group build a high-performing team. Sabancı Group’s digital workforce serves in diverse geographies of the world with unique capabilities and includes a wide range of certified specialists from various disciplines. The Group’s highly skilled digital team is a major competitive advantage: Talent is the most important asset for digital businesses to differentiate in the market and create value for customers.
In the digital business’s transformation journey, Sabancı Group refined the strategic business model into a more integrated structure with four main strategic pillars: Cyber Security, Digital Marketing Technologies and Services, Cloud and Technology Services, and Digital Transformation Products. The growth outlook and business potential of each respective pillar lead Sabancı Group to accelerate investments and build a foundation to create value globally.
Invest in New Growth Platforms
Sabancı Group’s retail business targets growth via digital platforms, complementary services and adjacent ecosystems.
In the Group’s tech retail activities, Teknosa took a major step forward in its customer focused digital transformation journey by successfully launching Türkiye’s first consumer electronics specialized marketplace on January 31, 2022. Teknosa Marketplace bolsters the company’s omnichannel capabilities and delivers customers a wide array of technology products from merchants that meet its high customer service standards.
In just 11 months of operation, Teknosa Marketplace has increased its product offerings by 22 times, traffic on the digital channel has risen by 38%, e-commerce gross merchandise value reached up 3.3 billion TL up by 136% year on year and the platform’s overall performance has reached global benchmarks.
In recent years, Sabancı Group has experimented with many initiatives in marketing technologies through SabancıDx, giving the Group the opportunity to validate unique digital marketing offerings. By 2021, the global market for marketing technologies had reached USD 250 billion. The marketing technologies segment has significant growth potential with projections of 40+% CAGR for the foreseeable future. SEM, a leading digital marketing agency in Türkiye and the first Google Premier Partner in the country, joined the Dx BV family in 2022. This market leader is wellpositioned to bolster the Group’s digital marketing capabilities and become the best place to seed and flourish unique value propositions for its business partners.
Growing use of digital technologies, the rapid rise of remote work, and increased awareness of business continuity have driven cyber security to the top of the agenda of decision-makers at all organizational levels. The global cyber security market is expected to reach USD 350 billion by 2026. Operational technologies (OT) security is one of the fastest growing sub-segments of cyber security. This enormous potential led Dx BV to invest in Radiflow, a developer of the most advanced products to secure critical infrastructures of the energy, utilities, manufacturing, transportation and logistics industries. Currently, Radiflow protects over 6,000 facilities globally and has a footprint in Europe, USA, Middle East, North Africa, and Asia Pacific.
Cloud adoption by the business sector increases every day and is only at the beginning of a very long and exciting journey. For many years, SabancıDx has invested in building know-how and talent in cloud technologies. The company has long served customers in their transition to cloud technologies. Recently, SabancıDx established a strategic partnership with Bulutistan, a Sabancı Ventures investment. Talented professionals from both companies are working together on the same campus to deliver the best cloud solutions to customers.
SabancıDx has built deep expertise, know-how, and an approach to creating insight-driven agile and scalable digital products to accelerate adoption and harness the power of digital. To date, SabancıDx has commercialized numerous products, including HrWe, Pratis, and Edoksis, which are used by 10% of Fortune 500 companies and more than 4,000 customers in the region every day.
The Way Forward
On the tech retail side, new business model and customer-focused innovations will accelerate Teknosa’s “phygital” strategy and serve as a growth catalyst.
As society becomes more aware of the environmental impact of electronic waste, energy consumption and its own carbon footprint, consumers are increasingly seeking sustainable alternatives to traditional modes of consumption. Refurbished cell phones offered in Teknosa Marketplace are an attractive alternative, allowing consumers to purchase a fully functional device at a lower cost while reducing the environmental impact of manufacturing processes. Newly introduced solar energy systems by İklimsa provide an opportunity to customers to decrease their carbon footprint. İklimsa holds a unique advantage: an already existing service network combined with knowhow to serve B2C customers.
SabancıDx is now transforming its ideation and productization capabilities under the umbrella of StudioDx’s Digital Factory. This effort is supported by unique ecosystem partners and strategic collaborations. Growth will be driven by the collective R&D power of Sabancı Group, which harnesses the academic capability of Sabancı University and the catalyzing power of SabancıDx in addition to invaluable intangible assets, such as talent, stakeholders, brand, R&D, and intellectual property.