"Israel is a leader in technology and the internet, which contribute 6.4% of GDP, but it lags far behind in e-commerce," said Google president EMEA Carlo d'Asaro Biondo at the annual Israel Internet Association conference in Jerusalem today.
"This is a paradox. Israel is in fourth place in the world in internet searches for product purchases, smartphone use in Israel is very high, as is the use of smartphones to check products and make price comparisons at a store. The problem is that e-commerce contributes just 0.5% of GDP," Biondo added.
Biondo said that Israel faces several challenges. "Consumers are used to buying in actual stores, believe that online prices are higher, and do not feel secure making an online purchase," he said, adding that small and mid-sized businesses are struggling to adapt to e-commerce. "The lack the infrastructures, struggle with the packaging and delivery logistics, and most aren’t online at all."
Biondo said that 98% of businesses are small and mid-sized firms, which account for 55% of Israeli jobs, but just 2% of them permit online payment. He said that e-commerce offers more purchasing options and ultimately offers consumers better prices. At the same time, small businesses enjoy growth, boosting the economy, and providing more jobs."
Published by Globes [online], Israel business news - www.globes-online.com - on February 21, 2012
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