Speaking at the HTIA2012 hi-tech conference in Jerusalem, eBay CEO John Donahoe said that the Israel R&D centers of the E-commerce giant and its subsidiary PayPal will continue to help drive the company’s innovation in commerce and payment in the foreseeable future.

“I believe that we will see more change in how consumers shop and pay in the next three to five years than we’ve seen in the last ten to twenty,” said Donahoe. eBay, he said, has focused the company on enabling that future.

Donahoe stressed that the ten trillion dollar commerce market is going through a fundamental transformation, saying that it’s at an “inflection point” due to changes driven by technology – primarily in the way consumers are using their mobile devices to shop. He noted that in the past year, in over half of offline retail transactions in the U.S., consumers accessed the web at some point in their shopping experience. Donahoe added that the lines are being blurred between online and offline shopping, concluding that “it’s time to take the ‘E’ out of E-commerce.” The eBay CEO said that much like in the world of media, consumers want their shopping “when they want it, where they want it, how they want it.”

Donahoe described a world in which, thanks to smartphones, salespeople will know shoppers’ names the moment they set foot in the store. “The value that smartphones are bringing in the world of commerce is just beginning,” he said.

In light of these changes, Donahoe said, eBay is investing heavily in its mobile technology. Nearly one hundred million people have downloaded eBay mobile apps in the last several years. Donahoe also pointed to the thousands of cars sold weekly on eBay on mobile devices alone.

Donahoe praised the role eBay’s and PayPal’s Israel R&D centers have played in helping drive the commerce revolution. Those centers are based largely on Israeli start-ups acquired by the commerce giant, including shopping.com, The Gifts Project and Fraud Sciences. Those centers, employing 340 people, work on everything from EBay’s global social activities to cataloguing and data to search mechanisms as well as security and risk management. “What they like is to innovate at scale – creating exciting entrepreneurialism and putting them on global platforms,” said Donahoe.

Donahoe said that he is looking forward to partnering with more Israeli entrepreneurs to help further spur the future of retail and commerce.