Executive Conversations

The Omnichannel Imperative: A Conversation with Özgür Tort of Migros Ticaret

The CEO of the Turkish retailer explains why "omnichannel is the backbone of the business."

글 Joëlle de Montgolfier and Leah Johns

First published on 8월 22, 2024
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In 2008, when Özgür Tort was appointed chief executive of Migros Ticaret, the Turkish retailer, he was just 35. Under his leadership, the company has grown to include around 3,500 stores and a strong online presence across Türkiye, employing 70,000 people overall. Founded in 1954, Migros Ticaret’s activities today include supermarkets, hypermarkets, wholesale stores, personal care stores, rapid online grocery delivery, a payment app, an online meal delivery platform, dark kitchens, electric vehicle charging stations, and a retail media network. During the Future Leaders Programme at the Consumer Goods Forum, cosponsored by Bain & Company, Tort discussed the transformation of the retail landscape with Joëlle de Montgolfier, Bain’s executive vice president for the global retail, luxury, and consumer products practices, and Leah Johns, head of Bain’s Consumer Lab. Q: Could you describe the journey that Migros Ticaret has been on and how you are thinking of meeting future consumer needs? Tort: “Omnichannel is the backbone of the business—and when I say omnichannel, I really mean it. We have around 3,500 stores, with more than 1,100 of them now serving as online hubs. That’s a significant shift that requires a lot of logistics backbone. We are running 52 distribution centers, with 16 packing centers. “We have a new motto pretty much in parallel to our omnichannel strengths: We want to be available to our shoppers in 15 minutes, regardless of whether it’s them visiting us or us visiting them. That links all our expansion and our household penetration. And that really works; if you have the agenda and the concentration, it really works. All our different formats cover this: grocery retail, upscale retail, personal care, wholesale. They have been doing a lot of new initiatives around the last mile. If we exclude items that are allowed to be sold in physical stores but not online, 19.5% of our business is in e-commerce. Yes, Covid helped, but that's a significant continuing trend. “Our new initiatives in areas such as our grocery super app and meal delivery are guiding us towards using transaction data to serve our shoppers better and more efficiently. Payment systems are enlarging. We are a very active digital banking player, serving our stores, our shoppers, our ecosystem of suppliers if they need financing, or our restaurant partners if they need payment services. All these initiatives use our payment app MoneyPay, which is integrated into our loyalty program. Our retail media channel is another innovation that draws on the data in our loyalty program. It mainly helps brands reach target shoppers much faster and make sure that they have a better ROI on their advertising spend.” Q: Could you take us through some of the changes you’ve made on sustainability? Tort: “This is a responsibility towards our planet and our societies. I’m glad to say that we have already decreased carbon emissions by 14.7%, which is great for us, because we are a growing company physically. For retailers the largest footprint of carbon emissions comes from the gas that we use in our cooling systems. Next is the electricity that we use for our chillers and heaters. This is why clean energy initiatives are very important. We are lucky in that we have large solar energy opportunities in this country. We decided, about a year ago, to invest in solar farms. And now we aim to hopefully produce one-third of our electricity consumption ourselves, mainly from solar, partly from wind. “We have seen during Covid that every continent, every country, is trying to be self-sufficient when it comes to sustainable food sourcing. We have a great responsibility to ensure this happens. That’s why we are heavily supporting local producers—to really come back to farming. Unfortunately, farmers’ ages have significantly increased in the last 20 years. In Türkiye today, the average farmer’s age is 53. We have to motivate young farmers to continue, through long-term contracting, for instance. “Waste in the food supply chain is another challenge. As an industry, we are losing, unfortunately, one-third of fresh perishables in the supply chain. We shouldn’t wait for governments or institutions to come up with solutions. What are we doing there? We promise small farmers that we will buy the whole harvest. The good produce goes to stores, the medium size goes to manufacturing, and the rest pretty much goes to food banks. This is our responsibility, but at the same time it’s a huge effort to help fight inflation.” Q: Before you became CEO, what advice did you wish you’d received? Tort: “When I was at the very early stages of my career, I was more focused on IQ. That really helped. But when it comes to results, creating relationships are the most important leadership skills that we all need. Today, new generations of employees have a basic background that is very strong, much stronger than the previous generations. However, building relationships is getting tougher. So, I think that my No. 1 requirement will be: just create more relationships, more networks. “And then there’s resilience. We’ve seen it during Covid and in economic crisis. Even if you are smart enough, even if you have great relationships, you have to keep trying. And you shouldn't stop trying all of the initiatives that you have tested. This is why we now have a new saying in the company, beyond IQ and EQ. The new thing is your AQ—meaning how to adapt yourself, and how to be resilient.”

In 2008, when Özgür Tort was appointed chief executive of Migros Ticaret, the Turkish retailer, he was just 35. Under his leadership, the company has grown to include around 3,500 stores and a strong online presence across Türkiye, employing 70,000 people overall.

Founded in 1954, Migros Ticaret’s activities today include supermarkets, hypermarkets, wholesale stores, personal care stores, rapid online grocery delivery, a payment app, an online meal delivery platform, dark kitchens, electric vehicle charging stations, and a retail media network.

During the Future Leaders Programme at the Consumer Goods Forum, cosponsored by Bain & Company, Tort discussed the transformation of the retail landscape with Joëlle de Montgolfier, Bain’s executive vice president for the global retail, luxury, and consumer products practices, and Leah Johns, head of Bain’s Consumer Lab.

Q: Could you describe the journey that Migros Ticaret has been on and how you are thinking of meeting future consumer needs?

Tort: “Omnichannel is the backbone of the business—and when I say omnichannel, I really mean it. We have around 3,500 stores, with more than 1,100 of them now serving as online hubs. That’s a significant shift that requires a lot of logistics backbone. We are running 52 distribution centers, with 16 packing centers.

“We have a new motto pretty much in parallel to our omnichannel strengths: We want to be available to our shoppers in 15 minutes, regardless of whether it’s them visiting us or us visiting them. That links all our expansion and our household penetration. And that really works; if you have the agenda and the concentration, it really works. All our different formats cover this: grocery retail, upscale retail, personal care, wholesale. They have been doing a lot of new initiatives around the last mile. If we exclude items that are allowed to be sold in physical stores but not online, 19.5% of our business is in e-commerce. Yes, Covid helped, but that's a significant continuing trend.

“Our new initiatives in areas such as our grocery super app and meal delivery are guiding us towards using transaction data to serve our shoppers better and more efficiently. Payment systems are enlarging. We are a very active digital banking player, serving our stores, our shoppers, our ecosystem of suppliers if they need financing, or our restaurant partners if they need payment services. All these initiatives use our payment app MoneyPay, which is integrated into our loyalty program. Our retail media channel is another innovation that draws on the data in our loyalty program. It mainly helps brands reach target shoppers much faster and make sure that they have a better ROI on their advertising spend.”

Q: Could you take us through some of the changes you’ve made on sustainability?

Tort: “This is a responsibility towards our planet and our societies. I’m glad to say that we have already decreased carbon emissions by 14.7%, which is great for us, because we are a growing company physically. For retailers the largest footprint of carbon emissions comes from the gas that we use in our cooling systems. Next is the electricity that we use for our chillers and heaters. This is why clean energy initiatives are very important. We are lucky in that we have large solar energy opportunities in this country. We decided, about a year ago, to invest in solar farms. And now we aim to hopefully produce one-third of our electricity consumption ourselves, mainly from solar, partly from wind.

“We have seen during Covid that every continent, every country, is trying to be self-sufficient when it comes to sustainable food sourcing. We have a great responsibility to ensure this happens. That’s why we are heavily supporting local producers—to really come back to farming. Unfortunately, farmers’ ages have significantly increased in the last 20 years. In Türkiye today, the average farmer’s age is 53. We have to motivate young farmers to continue, through long-term contracting, for instance.

“Waste in the food supply chain is another challenge. As an industry, we are losing, unfortunately, one-third of fresh perishables in the supply chain. We shouldn’t wait for governments or institutions to come up with solutions. What are we doing there? We promise small farmers that we will buy the whole harvest. The good produce goes to stores, the medium size goes to manufacturing, and the rest pretty much goes to food banks. This is our responsibility, but at the same time it’s a huge effort to help fight inflation.”

Q: Before you became CEO, what advice did you wish you’d received?

Tort: “When I was at the very early stages of my career, I was more focused on IQ. That really helped. But when it comes to results, creating relationships are the most important leadership skills that we all need. Today, new generations of employees have a basic background that is very strong, much stronger than the previous generations. However, building relationships is getting tougher. So, I think that my No. 1 requirement will be: just create more relationships, more networks.

“And then there’s resilience. We’ve seen it during Covid and in economic crisis. Even if you are smart enough, even if you have great relationships, you have to keep trying. And you shouldn't stop trying all of the initiatives that you have tested. This is why we now have a new saying in the company, beyond IQ and EQ. The new thing is your AQ—meaning how to adapt yourself, and how to be resilient.”