Department Stores in Israel

PROSPECTS

Lack of brand knowledge limits growth

In 2018, branding was a key factor for successfully operating a business in Israel. Consumers are exposed to many advertisements via mass and social media, and when they make purchases, they want to purchase brands that they have seen before and with which they are familiar.

Changes in consumer behaviour hamper the growth of direct selling

Consumers’ decision-making process changed in recent years. Internet searches now help consumers to seek information, compare prices, check reviews and more.

The transition from direct selling to internet retailing

As direct sellers recognised the changes in consumer behaviour, they modified their marketing approach, building websites and stores, whilst also promoting their products online. This created more familiarity and credibility for their own brands.

COMPETITIVE LANDSCAPE

Nu Skin Israel leads direct selling

Nu Skin Israel was the leading player in direct selling in value terms in 2018, and continued to see share growth despite its declining sales. Within direct selling, it benefits from relatively high recognition.

Sunrider Israel follows

Sunrider Israel, the second player in direct selling in value terms in 2018, also continued to see share growth despite its declining sales in 2018. It has local and global websites which allow consumers to buy online.

The move towards internet retailing

Over the forecast period, some players are expected to shut down their direct selling operations and exit the channel, shifting their activity to more effective channels such as internet retailing and even store-based retailing.

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