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Insights into the Growth of Israel E-commerce

General information about Israel

GDP: 286 million
Total Population: 8.20 million
Age Breakdown: 37.8% of the population in Israel are between 25 and 54 years old.
Religion: Israel is a Jewish country, with the majority of inhabitants (75.4%) following Judaism.
Urban Population: 92%

E-commerce facts & figures in Israel

Internet Penetration: 74.7% , with 5.9 million people
Mobile Penetration: 123%
Tablet Penetration: 9%
Smartphone Penetration: 56.6%
Online Shoppers: 3.04 million
E-commerce Sales: USD 2.09 billion in 2009 (ILS 7.9 billion )
E-commerce Penetration: 38%
E-commerce CAGR: 24.9% (2009 – 2014)
Mobile Commerce: USD 169.5 million (ILS 638.9 million)
Mobile OS platforms: Apple’s iOS is the preferred mobile operating system in Israel at 49.3%%, but closely followed by Android at 47.6%.

Mobile commerce and online shopper behaviour in Israel

Despite being a technologically advanced country with a focus on innovation and entrepreneurship, Israel has a relatively small e-commerce market. This has led to the trend of many Israeli tech startups being acquired by major US, European and Asian technology investors. Yet, with increasing levels of mobile penetration by an always connected younger generation, the domestic and cross-border e-commerce market shows great growth potential.

Cross-border e-commerce opportunities

Israel is among the top five fastest growing cross-border e-commerce export markets in 2014.
Israeli consumers mostly purchase from online sellers in China and Brazil.
Israeli businesses mostly export to the US, the UK and China.

Language as a key driver

Israel has two official languages: Hebrew and Arabic. However, a clear majority of the population speaks and reads English. Communicating in Hebrew or Arabic is not considered necessary.

For Jewish Israelis, who make up 83% of the country’s population, the normal spoken language is Hebrew.
All Israeli school children learn Hebrew, Arabic and English, and virtually everyone in the country speaks English well.

Hebrew is not widely spoken outside of Israel, but it is spoken by several hundred thousand speakers in the Palestinian territories and foreign Jewish communities around the world.

Preferred delivery and payment methods in Israel

The Israeli Post has around 1,000 service points for consumers who choose to pick up their online purchases. There are also a number of companies offering home delivery services as well.

A majority of Israel online consumers prefer to pay for their purchases by credit or debit card. The second most popular payment method is e-wallet services, Paypal is the most popular e-wallet among customers who make online purchase.

Top 5 e-commerce websites in Israel

Top1. Bizzabo
Website: http://www.bizzabo.com
Bizzabo’s holistic events cloud empowers marketers to drive impactful in-person experiences at professional events, from start to success.

Top2. Fiverr
Website: https://www.fiverr.com/
Fiverr gives you instant access to millions of Gigs from people who love what they do.

Top3. Webydo. 
Website: http://www.webydo.com
Webydo is a SaaS platform enabling designers and agencies to create, host and manage code-free, responsive websites for their clients.

Top4. Riskified 
Website: https://www.riskified.com/
Riskified is an all-in-one e-commerce fraud prevention solution and chargeback protection service for high volume and enterprise merchants.

Top5. Twiggle 
Website: http://www.twiggle.com
Natural Language Search for e-commerce

High growth prospects in Israel

Between 2009 and 2014, e-commerce in Israel showed a compound annual growth rate (CAGR) of close to 25% which was more than double the global growth rate. E-commerce revenue in Israel reached to USD 3.6 billion in 2016 and forecast to rise to USD 4.9 billion in 2020.

Israel is a fairly digitalized country with a 75% Internet penetration and a smartphone market of over 60%. The dominant e-commerce categories in Israel are Home Electronics, Fashion & Footwear and Media Products. Housewares and groceries are also popular to buy online.

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