Israeli Economy 2013

Israelis Learn to Shop Online for Bargains Overseas

Low prices and the increasing possibility of free or cheap direct shipment to Israel are leading locals to buy more from foreign website, while the local chains lag in their online efforts.

2013 was a breakthrough year for e-commerce sales in Israel, with 85% of Israeli credit card holders making online Internet purchases, according to the Israel Internet Association. Moreover, the average price of online purchases made by Israelis from the United States increased to $180 in 2013 compared to $120 in 2012. The association also stated that 52% of the Israeli online shoppers usually shop on Israeli e-commerce sites, compared to 25% who usually shopped on foreign e-commerce sites and 25% who shop equally on both domestic and foreign sites.

However, until 2012 sales figures showed that many in Israel liked to compare prices online but buy goods in actual brick-and-mortar stores. The situation has not changed entirely; Israelis still find it hard to buy goods online. Potential hang-ups include the belief that e-commerce vendors may be unreliable and that they have to pay high shipping fees for goods that can be bought at the mall. However, the biggest barrier is that they do not receive aggressive sales discounts to overcome their fear of remote shopping.

Many of the local store chains are still deterred by the transparency and competition e-commerce engenders on the Web; the stores that do sell on line can be counted on two hands.

Overseas, a step ahead

Global e-commerce sites, in contrast, are a step ahead and offer a pleasant user experience with rock-bottom prices. Many sites offer Israeli shoppers goods at reasonable prices and make sure to ship them free or at low prices. The leading websites in the United States for Israeli shoppers this year were RadioShack, eBay, Amazon, DealXtreme, BestBuy and Bhphotovideo. According to the figures provided by eBay, in the category of replacement parts and accessories for cars there was an increase in sales to Israel from tens of thousands of items in 2012 to hundreds of thousands in 2013. The company said that every 18 minutes an Israeli buys a car, a light bulb lights up on the site.

Israel Post says that in 2013 there was a 90% increase in the quantity of packages that arrived in Israel from abroad. Just in the last month, due to the sales following Black Friday and ahead of Christmas, there was an additional 25% increase in the number of packages sent. According to the website of buy2usa, there was a 300% increase in 2013 in the size of clothing sales from the United States to Israel, comprising 37% of imports here. There was also a 140% increase over the past year in the purchases of electronics and electrical items.

The increase in online orders from Israel may be seen in the increased number of foreign sites offering shipment directly to Israel. Previously many suppliers were not interested in shipping goods to Israel due to lack of profitability. Even when a site does not ship to Israel, there are workaround solutions. For example, there are Israeli shipment companies providing an American address to those interested in ordering from sites that do not ship goods here.

Tomer Appelbaum