The e-commerce giant reported a profit of $82 million, or 18 cents a share, down from $130 million, or 28 cents a share, a year earlier.

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Today’s consumers have a world’s worth of information at their fingertips, anytime, anywhere. As of February 2012, half of mobile phone users have smartphones, and they’re accustomed to answering any question they have with a quick Google search or a barcode scan.

The information age has created some new challenges for retailers. To begin with, it’s now incredibly simple for a customer with a mobile phone to walk into an electronics store and scan the TV or camera she’s thinking about purchasing to do an instant price comparison against other brick-and-mortar or online retailers. This kind of behavior change is disruptive to retailers, and is forcing them to rethink their policies and business practices.

Millennial shoppers used to information on demand, and more globally aware than their parents and grandparents, expect greater variety and better quality, and they care about where their goods came from and how they affect the world. They want to know — or at least feel entitled to know — who stitched together their sneakers, whether the farmer who grew their coffee was fairly paid and the size of their potato chips’ carbon footprint.

For retailers in the grocery sector, demands for transparency are triggering bigger conversations. Take Proposition 37 in California — a bill that would have forced food suppliers to label genetically modified foods. Food suppliers stood on both sides of the issue. Agricultural powerhouse Monsanto was one of the largest funders against it, arguing that the bill would force unnecessary labeling of perfectly safe, common foods — a kind of Scarlet Letter. Meanwhile, yogurt manufacturer Stonyfield Organic donated in support of the bill, calling for transparency and less ambiguity in labeling. The bill was ultimately defeated by a fairly small margin (53.1 to 46.9 percent), and the issue has not been put to bed. The trend (or perhaps it’s a pendulum swing?) toward transparency is inexorable.

Another challenge posed by today’s torrent of information is the increase in “noise” compared to the “signal.” Facts that are easy to digest and easy to find don’t always tell the whole story. “Food miles” are a vexing example. When thinking about the carbon footprint of food, our natural instinct is to assume that the fewer miles the food travels, the better. Sometimes this is true — but when you’re comparing, say, tomatoes grown in Mexico to tomatoes grown in a greenhouse in New Jersey, food miles alone don’t tell the whole story. The reality is the energy spent heating a greenhouse may outweigh the fuel spent transporting the field-grown tomatoes from Mexico. In fact, transportation typically makes up less than 15 percent of the carbon footprint of produce.

For all the challenges retailers face as they adjust to the new reality of a digital age, there are also some enormous opportunities for those willing to adapt. Today’s consumers may be more skeptical, but they’re also accessible in new ways and are looking for personalization. Retailers now have the opportunity to move beyond mailing weekly circulars full of coupons — they can share local, real-time promotions on Facebook. A grocery store that’s just received a shipment of unusually sweet, juicy pineapple now has the means to tell that store’s shoppers about it instantly. Feedback is “ripe” to be transformed too. Who today would bother walking back to a store with a tasteless watermelon or soggy bag of salad to complain? But scan it with a mobile phone to give feedback to the store and grower (and get an instant coupon) — that is not only simpler, but actually generates more useful information for the store and supplier.

Some retailers in the grocery industry are already moving in this direction. The Kroger family of stores, which includes Kroger, Fred Meyer and Ralphs, has taken a progressive approach to consumer engagement and transparency. It was the first retailer to let shoppers trace produce back to the farm via the Internet and mobile apps — telling shoppers where their fruits and vegetables came from. In addition to building customer loyalty, this increased connectivity allows Kroger, in the rare event of a food recall in a category, to let shoppers know more precisely which products were affected. Retailers are also experimenting with scanning tunnels that can read more complex barcodes — including capturing information about freshness of perishable items.

As we move forward, retailers will figure out how to embrace consumer engagement. Instead of maintaining one corporate social media page, we can expect to see a much more nuanced approach, with local stores creating individual profiles where they can interact with local shoppers (they just have to figure out how to staff them). Instead of running a print ad for strawberries a few weeks in advance of Valentine’s Day, they’ll be able to push a timely nudge to their shoppers when the berries are abundant and at peak sweetness. The knowledgeable and friendly family greengrocer of the 1950s will be re-imagined with a smart algorithm that can make sensible recommendations based on what’s good today — and what the shopper’s personal dietary preferences are. It’s a more responsive approach, and could profoundly change the supply and demand dynamics in place today that favor availability above all.

Longer term, over the next decade or so, stores that sell faster-moving goods will face the same turning point that electronics, book and clothing sellers reached in the last decade — with fast, richly personalized online shopping now available, what’s the role of a physical store? Could the experience be replicated or improved online? I remember when the idea of shoe shopping online sounded like the opening line of a joke, but Zappos changed all that with brilliant logistics and piercing consumer insight. The same can and will happen for the grocery sector. In 10 years, I think we can expect to see grocery stores that focus less on staples like cereal and paper towels, and more on seasonal, sensory, impulse purchases. Today, produce makes up about nine percent of retail grocery purchases and shelf space. In the future, as more people turn to the Internet for the bulk of their groceries, produce could make up more like a third.

Whatever the next decades bring, it’s not much of a prediction to say that technology will reshape retail. Stores that can experiment with transparency, increase personalization, eliminate waste and build trust will win the hearts and shopping baskets of the millennial generation.

Elliott Grant is the founder and Chief Technology Officer 
for YottaMark. He founded YottaMark with the vision that giving products a unique identity is the foundation for real-time supply chain insights and recall management, as well as a powerful platform for brand owners to create new consumer connections. Previously, Elliott was VP of Operations for a $250M food-packaging manufacturer and was an engagement manager at McKinsey & Company. He holds a PhD in Engineering from Cambridge University.

Two publishing industry groups, the Authors Guild and the Association of American Publishers, are objecting to the online retailer’s request for ownership of new top-level domain names that are part of a long-awaited expansion of the Web’s addressing scheme. They argue that giving Amazon control over such addresses — which include “.book,” “.author” and “.read” — would be a threat to competition and shouldn’t be allowed.

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With that proposal off the table, it appears Mr. Schulze won’t be able to execute the buyout of the beleaguered electronics retailer that he had proposed last year, the people said. However, it is still possible that Mr. Schulze will come back to Best Buy with another proposal, they said.

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Now, the recent graduates of Carnegie Mellon University’s business school work for the world’s largest home-improvement retailer, Home Depot Inc.

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The Marketplace Fairness Act was introduced to the Senate today, which would enable states to collect sales tax online, as long as they have simplified their tax laws.

In a letter, Paul Misener, Amazon’s VP for global public policy, said, “I am writing to thank you for your bill, which will allow states with simplified rules to require sales tax collection by out-of-state sellers who choose to make sales to in-state buyers.”

Misener never comes out and explicitly says that Amazon supports the bill, but he hints that, with close cooperation, it could be a winner: “Amazon.com has long supported a simplified nationwide approach that is evenhandedly applied and applicable to all but the smallest volume sellers.”

Collecting sales tax can be a nightmare. Not only does it depend on what state or country the customer lives in, but also on where the purchaser is — down to the city block, potentially — if he or she is buying something on the phone. Depending on the state, it could also be determined by the shipping address.

Amazon has been considered a prime example for why tax reform is needed. Since it was founded in 1994, the retailer has taken extraordinary measures to avoid collecting sales taxes nationwide, although more recently its stance on the subject has been softening. It now collects taxes in more than half a dozen states. Most recently, it agreed to start paying sales tax in Pennsylvania, Texas, California and Connecticut.

Brick-and-mortar retailers have contended for years that Amazon had an unfair advantage because it did not collect sales tax at the time of purchase. (Technically, it is the customers’ responsibility to pay the taxes, but that’s not very practical.)

The Marketplace Fairness Act is being introduced by Sen. Richard Durbin, an Illinois Democrat, and two Republicans, Sens. Mike Enzi of Wyoming and Lamar Alexander of Tennessee. Under the law, states will have two options for simplifying their tax-collection process. Retailers that have less than $1 million $500,000 in out-of-state sales the prior calendar year can apply for exemption.

According to the Marketplace Fairness Act homepage, a long list of companies support the proposal, including Amazon, Best Buy, Barnes & Noble., Gap, Home Depot, J.C. Penney, REI, Sears, Target and Walmart. One of the organizations listed in opposition is eBay.

But Flurry, a mobile analytics company, is introducing the term “app & mortar” in a new report published today that explores the rise in smartphone shopping.

Clearly, the term is a play on the term “bricks and clicks,” which emerged in the late ’90s and became popular as e-commerce started to challenge physical retailers.

In some respects, this report confirms what we already knew about mobile commerce, but takes it a step further by figuring out who is benefiting the most right now from the trend. Surprisingly, it’s physical retailers.

In the report, Flurry analyzed the amount of time spent by consumers across more than 1,800 iOS and Android shopping apps in December 2012, compared to the same month a year earlier.

The biggest growth category by far was apps developed by retailers, such as Walmart, Macy’s and Gap.

Flurry said time spent in retail apps skyrocketed by 525 percent year over year. In contrast, online marketplaces, such as eBay and Amazon, increased by only 178 percent.

In terms of the share of shoppers’ time being spent inside the different apps, retailers also saw the biggest gains. In December 2012, shoppers spent 27 percent of their time inside of retail apps, up by 12 percentage points over the same month a year earlier.

The gain in share by retail apps came at the expense of online marketplace and daily deal apps, which declined year over year. The share of time being spent with online marketplaces decreased from 25 percent in December 2011 to 20 percent in December 2012. Daily deal providers, like Groupon and LivingSocial, fell to 13 percent from 20 percent.

Flurry did not offer a lot of analysis as to why this was occurring, but suggested that retailers were beginning to better respond to the move toward “online meeting offline shopping through mobile apps.” In general, 2012 was the first year that many online or physical retailers took mobile shopping seriously, so it was likely that the distribution of time spent would change with a huge surge in consumer interest and better options.

Interestingly, even though Flurry noted a decrease in time spent in online marketplace apps, eBay still easily beat its mobile revenue forecast (so it’s not clear if there’s a direct correlation between time spent and dollars spent). Last week, eBay said it recorded $13 billion in mobile revenue in 2012, exceeding its forecast of $10 billion. This year, the online retailer expects mobile revenue to hit $20 billion.

EBay is the most transparent of the larger e-commerce players when it comes to mobile’s contribution.

In contrast, an analyst’s best guess for Amazon is that about $3 billion to $5 billion of its annual sales are coming from mobile devices.

Google Google’s VP of Shopping Sameer Samat

At the top of the Shopping page, a photo shows a snowboarder floating down a mountain on a clear blue day, directing consumers to a page where they can compare the lastest ski equipment. Another link sends consumers to a Garnet Hill catalog, where they can see an electronic copy of the print version that normally clogs mailboxes.

A deeper dive into the Shopping experience reveals that some of the product pages have a blue button in the top right-hand corner that could easily be mistaken for Amazon’s “Add to Cart” yellow button.

Despite these visual cues, said Sameer Samat, Google Shopping’s VP of product management, in an interview with AllThingsD, the company has no aspirations to open a store. “We aren’t planning on being a retailer,” he said. “We don’t view being a retailer right now as the right decision.”

Behind closed doors, some have wondered if Google was building up the infrastructure before making the move into selling physical items. Along with the updates to the site, another recent announcement that got people chatting was when Google announced last month that it acquired BufferBox, a locker service where consumers can safely pick up packages.

Samat said that BufferBox had nothing to do with becoming a retailer; it was about helping other retailers to become more competitive.

“We are trying to provide a level playing field for retailers,” he said, adding that there are some companies that have managed to do both tech and retail well. “How’s the rest of the retail world going to hit that bar?”

Of course, one of those companies is Amazon. The technology powerhouse has been working for almost two decades at building out the infrastructure to store merchandise all around the world. It has also built a first-class consumer-facing business that sells and distributes nearly anything you could need, as cheaply as possible.

To compete, retailers — and especially brick-and-mortar companies — are faced with either investing heavily in technology or teaming up with a technology partner like Google. At least, that’s Google’s pitch: “I think it’s great that Amazon and others, like Rakuten, are upping the bar,” Samat said, but Google is just trying to partner with retailers to “create a level playing field.”

Over the past year, the Google Shopping team has been busy adding improvements to the site.

This summer, Google completely overhauled its shopping experience. While the move has remained fairly below the radar for consumers, it has been very controversial among merchants. In fact, Samat jokes that at some point he’ll receive “The Least Popular Dude” award.

That’s because in the new system, retailers must pay to ensure that their products show up within Google Shopping. Previously, merchants could upload their data feed for free. This is the first holiday season in which retailers have had to pay to participate, and despite the service being so new, many retailers are reporting good results.

Google has made some major technology improvements, too.

It built an imaging system that creates 360-degree photos of the products. While it’s still not like being in the store, you can get a better sense of the product when you can see an item from all angles. Look for the “3-D” swivel icon on the product image to get the 360-degree view. It’s not available for that many products at this time, but Google did put together a Holiday Toy Collection, featuring 3-D images for each of the items.

There are at least a couple of hints that the photos aren’t a completely smooth-running operation yet. Google had to purchase all of the toys in the collection in order to take the photos, and, as Samat found out, those Lego kits don’t build themselves.

Google’s goal of becoming a retailer’s best tech friend may sound noble, but it is also smart. Amazon is already a starting point for many consumers on the Web, especially when it comes to shopping. Google obviously wants to be the first destination people visit for pretty much anything.

Additionally, the Seattle company is encroaching into other territories, including consumer electronics, like the Kindle Fire, which, coincidentally, runs on Google’s Android operating system. Amazon also distributes digital content and provides back-end cloud services to enterprises.

Google is not the only technology retailers can turn to if they are feeling competitive pressure from Amazon. Just down the road is a major player in the retail services space: eBay. The San Jose-based company has spent more than a year making inroads into the space, by forming tight bonds with a number of big retailers and by acquiring a company called GSI Commerce, which provides a lot of the back-end services mentioned.

Looks like it’s not just the consumer’s pocketbook that businesses are after anymore — it’s the retailer’s purse strings, too.

Walmart is slashing the price of a few iPhone and iPad models — including Apple’s flagship iPhone 5 — in 3,000 stores, reports Reuters.

The 16 gigabyte iPhone 5 will cost $127, compared to the original price of $190 (with a two-year contract from Verizon Wireless, Sprint or AT&T). Wal-Mart is also selling the 16GB iPhone 4S for $47 — nearly half off. The 16GB iPad with Wi-Fi will cost $399, or $100 off.

Interestingly, the 30-day promotion has Apple’s blessing. A Walmart spokeswoman told Retuers that the discounts were arranged with Apple. But, after making a few inquiries, the discounts proved difficult to find in a handful of locations in Washington and California.

I was told that the iPhone is only carried at Walmart Supercenters, which, if true, should make the hunt easier, since there are only 3,100 supercenters in the U.S., roughly the equivalent number of stores where Walmart is supposedly offering the discounts. Instead, I found the inventory and prices to be wildly inconsistent.

My advice, if you plan on taking on the challenge, is be patient. It takes awhile to find the correct person in electronics to answer your question on the phone, and hold times can be long. In one case, I was hung up on; in another extreme case, a representative simply told me that the iPhone 5 would cost “a lot.”

After calling the stores close to my home, I found that some only carried phones for Verizon Wireless and sometimes AT&T, but never Sprint. Additionally, inventory was limited to the 16GB iPhone 5, with none carrying the higher-capacity 32GB model.

Finally, after calling two stores in the San Francisco area, I found one Supercenter that was selling the iPhone at a discount. The Walmart in American Canyon, Calif. said the phone from Verizon Wireless would cost $127 with a two-year contract, but the iPad remained at its original price of $499. The Supercenter in Napa continued to charge full price for all the devices.

Here’s one idea: To save time and the headache of calling around, go to one of the many stores that are offering to match the lowest prices this holiday season, including Best Buy and Target, which have both vowed to honor some competitors’ prices. Perhaps you’ll have better luck there.

Wall Street is certainly enthusiastic for such an outcome — even grabbing onto a specious rumor that perhaps Google was sniffing around the troubled Chicago-based social discount deals company, which is currently valued at just over $3 billion. On Friday, Groupon’s stock jumped 23 percent on takeover speculation after Tom Forte of Telsey Advisory Group was quoted as saying: “Where the stock is currently trading, it’s a takeout candidate.”

Actually, the stock has been trading at these levels for a very long time, so the sudden attention is decidedly overwrought. More to the point, sources close to Google — which had offered $6 billion for the company before it went public — said that Google has not been contemplating a second foray into acquiring Groupon.

The same is true for eBay, said sources, and Amazon is an unlikely buyer because it already owns a stake in LivingSocial, the second-largest daily deals provider. Additionally, there are lots of other problems that any purchaser would face in buying the company, which sells everything from bikini waxes to GPS devices at a discount.

In an onstage appearance this morning, CEO Andrew Mason declined to address the thinly sourced rumors of a takeover. “What I have said about Groupon is everything I will say about it,” he said. “I am focused on looking forward.”

Given the non-answer, it’s still prudent to ask, is there actually a buyer for Groupon?

First, let’s address the price. Two years ago, Google offered to purchase Groupon for $6 billion. A year later, it went public at $10 billion, and today, it is trading for $2.9 billion. The company has $1.2 billion in cash, and owes merchants about half of that, or around $573 million.

That said, it is still a relatively low price for a company that includes a customer base of 40 million people who bought something in the past year, a hodgepodge of local retailers and merchants that consider Groupon their online marketing channel, and — perhaps most importantly — a better-than-expected mobile business that now represents a third of its transactions.

But, while it costs much less than it once did, that doesn’t necessarily make Groupon a steal.

That’s because over the past year, the Chicago company has stumbled operationally. Europe is underperforming, the company’s main coupon business is slowing as the novelty of the business is wearing off and it has started investing heavily in selling products, a low-margin business that requires tons of logistics to package and ship items to people’s front doors. On top of that, the board recently discussed replacing Mason, who some directors fear may not be the right choice to continue leading the company. While they ultimately decided to keep him, it was a perceptual blow.

At least one big investor is betting something will happen: Tiger Global Management, which recently bought up close to 10 percent of Groupon. The well-regarded hedge fund and private equity firm may be betting it can’t get worse, and perhaps would even push for a sale.

In any case, here’s a look at some of the scenarios:

Google

When Google made the offer two years ago, the search engine was interested in entering the daily deals business as a way to gain a foothold into all things local, including commerce. Since Groupon rejected that $6 billion acquisition, Google has spent the past two years building Google Offers.

While Google Offers still has a very small piece of the market, it has been pivoting toward an integrated ads model, which is less complementary to Groupon’s approach. Google believes that merchants will pay Google only after a purchase has been made, and the sum will be determined by the consumer. The cost per acquisition model is very different from Groupon, which has the consumer paying up front for a heavily discounted coupon.

As one source with knowledge of the situation said: “The timing would be a bit wacky.”

That said, Nikesh Arora, Google’s SVP and chief business officer, had been a very strong advocate of the original deal and might still want more heft in Google’s corner in the competitive local scene. One major plus is that Groupon could also help build a local salesforce to push Google+ Local, which includes Zagat, the online reviews site that competes against Yelp. Groupon might also support its Google Wallet business, which has largely failed to gain traction among consumers.

Another source familiar with the two companies said running a daily deals business is “operationally intensive, and it’s a muscle that Google doesn’t have, so from a synergy standpoint it would be complementary.” But, “if they are still serious about local, is that the business model for local that they want to pursue?”

eBay

For the past two years, the e-commerce company has aggressively been going after the local commerce market by helping transactions occur online or at a nearby store. Additionally, its PayPal division is moving fast into the physical payments space. Strong merchant relationships, like the ones Groupon has, could go a long way toward making those things happen faster.

EBay recently raised $3 billion in debt financing and has $7.3 billion cash on its balance street. Its stock price also has gone up more than 65 percent in the past year, giving it plenty of fire power to make a big move.

It also has the stomach for acquisitions. However, many of its purchases over the past two years have been about buying technology and talent. It bought RedLaser, the barcode scanning technology for $10 million; Milo.com, a local inventory company, for $75 million; and Zong, a mobile payments company, for $240 million. Over the years, it has also made substantial purchases, including GSI last year for $2.4 billion, Bill Me Later for $1.2 billion and Skype for $2.6 billion.

A few months back, the company entered the daily deals business with the launch of eBay Lifestyle Deals, which runs daily deals in a number of markets, including San Francisco, Seattle, Los Angeles and Washington, D.C. To do so, eBay teamed up with Signpost, which arranges the deals with local merchants. Interestingly, Signpost is backed by Google Ventures, and already provides deals for Google Offers.

The company is also experimenting with eBay Now, a service that allows consumers to buy something on their phone and have it delivered within an hour. “They continue to be interested in local, and they have this experiment going on right now with eBay Now, but they are still iterating and figuring out the local angle,” one source said.

Likewise, PayPal’s local strategy is under development. It is trying to roll out physical payments to big-box retailers like Home Depot while also offering a credit card reader for smaller retailers called PayPal Here.

The biggest argument against this deal is that eBay may not need Groupon, and that it already has the infrastructure to roll out deals through partnerships — which would cost a whole lot less and be a lot less painful.

Amazon

Simply put, Amazon already has its own troubles with its significant stake in LivingSocial, which just slashed 400 jobs. In the third quarter, Amazon took an impairment charge of $169 million, or 37 cents a share, related to its stake in LivingSocial, resulting in the company reporting an overall third-quarter net loss of $274 million, or 60 cents a share.

Any potential Amazon-Groupon tie-up would then be a merger between LivingSocial and Groupon, creating perhaps an even bigger black hole that would also result in a lot of ongoing integration problems. While together LivingSocial and Groupon would easily make Amazon the largest daily deals company and up its local commerce efforts, it’s still not clear if the online retail giant wants to double down here.

Separately, Amazon has entered the daily deals business on its own with a service called Amazon Local that competes directly with LivingSocial and Groupon. The offers became particularly interesting to the company after it started using them to discount the price of its Kindle e-readers and tablets. If owners don’t want to see the offers, the tablets can cost up to $40 more.

The company has said that it essentially doesn’t need help building the business – it thinks it can get to scale fast in the space because it already has 164 million active customer accounts worldwide (which are defined as people who have made a purchase in the past year).

Perhaps most importantly, though, Amazon has a history of building, not buying.

Visa, MasterCard, American Express

These three payment companies have huge market values, and should not be discounted as players in the local commerce space. In addition, a year ago, all of them started looking for new revenue streams after the Durbin Amendment capped the amount that banks and card networks charge merchants on debit card transactions.

Already, many banks are sending targeted ads or deals to consumers based on their spending habits. However, it’s unclear whether they need to be the actual deal makers, or just act as a distribution system for advertisements and coupons. For example, MasterCard recently partnered with Gilt City, the daily deals division of Gilt Groupe. Through the partnership, MasterCard will be able to offer its users deals for restaurants, concert tickets and travel, and at the same time, help Gilt City get in front of some of the card issuer’s millions of users.

MasterCard may be the frontrunner of the three as a potential suitor. Not only has it shown direct interest in the space, American Express is still absorbing its acquisition of Revolution Money, for which it paid $300 million cash in 2010, and Visa has been active with its purchase of CyberSource for $2 billion in 2010. More recently, it made an investment in Square, the hot mobile payments company.

Other Suspects

A number of other companies could be put on a Groupon acquisition list, such as Yahoo, Microsoft and Facebook.

Microsoft and Yahoo both have the money, but have not done much in the space so far. An acquisition would allow them to catch up quickly, but would be expensive and largely not complementary with what they are doing already — which is almost nothing. Facebook, in particular, tried once to enter the space and failed and might be focused on other lower-hanging revenue sources.

Groupon could also look to private equity firms for a buyout, which would allow it to have some space while it fixed some of its issues.

Internationally, there is Japan’s Rakuten, which owns Buy.com in the U.S., and China’s e-commerce giant Alibaba, which has been looking at ways to enter the U.S. market.

Of course, Groupon might simply keep stumbling forward and hope it can turn itself around. But, at some point, without improved revenue and cohesion at the top levels, something is sure to bring pressure to its options. 

In fact, in afternoon trading today, the rumors continued to keep the stock elevated. Shares closed 3.76 percent higher today at $4.41 a share.

Some analysts said yes. (For the record, we at AllThingsD are dubious. But, for the moment, we’re going to pretend that not spending dough on stuff is just like spending dough on stuff.)

Andrew Lipsman, an analyst at comScore, insisted there’s little distinction between whether consumers make the transaction on the phone or whether they later go home and make a purchase on a computer.

“It’s just the introduction of mobile devices into the brick-and-mortar environment that’s affecting consumer behavior,” Lipsman said.

According to recent comScore data, 37 percent of shoppers this past quarter displayed “showrooming” behavior — the act of price-checking using a mobile device while shopping in a traditional brick-and mortar-store. That’s compared with 32 percent of showrooming shoppers in the second quarter of the year. (Note to the math-challenged: This is a small increase, given the explosive growth of smartphones over the last year.)

But Forrester analyst Sucharita Mulpuru echoed Lipsman’s statement in a recent blog post, noting: “Most of the showrooming shoppers told us that they usually find cheaper prices online when they research them … A lot of people switch retailers when they find cheaper prices online.”

It’s apparently not all bad news for brick-and-mortar, though. As Forrester’s Mulpuru pointed out, some research leads not only to Amazon.com, but to another store. About 18 percent of mobile shoppers surveyed opted to head to another store to make a purchase, while just 15 percent said they went online instead.

Key takeaway: We’ll buy lots of stuff in lots more ways.

In an interview with Matt Lauer on the “Today” show this morning, Jeff Bezos said, “It will be a record season for us, knock on wood.”

Amazon is hiring 50,000 seasonal workers to help pick up the pace in its dozens of warehouses worldwide, which will be humming at full capacity with employees packing and shipping oodles of boxes to homes in time for Christmas.

This year, physical retailers have lined up a fairly broad defensive strategy against the online behemoth. Many retailers are promising to match online prices, or even taking it a step further by offering same-day shipping in some markets (which is a day faster than Amazon can usually offer).

Still, Bezos was upbeat about the company’s holiday prospects, and likely for good reason. Last year, Amazon’s revenue grew 35 percent in Q4 compared to the same period in 2010 — double the rate of the overall e-commerce market. “We’ve always been in a hyper-competitive industry. That’s a good thing. It’s good for customers, and it’s good for the companies who are forced to innovate,” he told Lauer. “We have to evolve, and we are providing better customer service today than we ever have.”

Bezos appeared on “Today” freshly named as Fortune’s 2012 Businessperson of the Year for his role as the “ultimate disrupter.” Here’s the interview, which is worth watching to hear Lauer botching the name of Amazon’s best-selling Kindle Paperwhite (a.k.a. the Paperweight):

Visit NBCNews.com for breaking news, world news, and news about the economy

Chain stores prefer impulse-purchase-prone store shoppers. Yet sales growth during the busy Thanksgiving weekend more often is coming from Internet shoppers like Melanie Cortese.

Going to Woodbridge Center Mall with her mom on Black Friday was a family tradition for Ms. Cortese, a 37-year-old New Jersey mother of two. But no longer: she plans to go to bed on Thanksgiving night with a laptop nearby and wake up on Back Friday to shop online instead.

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“E-commerce has been on fire since its inception and it still continues to grow and outpace the overall retail economy,” said Sucharita Mulpuru, an analyst with Forrester, who studied recent trends to come up with this year’s holiday forecast. “And because e-commerce is growing so much faster, it’s taking share from the offline world. It takes more share during Q4 than the rest of the year.”

In the report, Mulpuru concluded that the number of online shoppers in the U.S. will grow a modest 3 percent, but that the average shopper will spend $419 online this holiday, a 12 percent boost over 2011.

Overall, if spending does increase 15 percent this holiday, the rate of increase will be flat compared to the prior year, but the gains are still very impressive given the much larger base (see chart below). It also points to the fact that e-commerce still makes up only a small fraction of overall retail spending.

There are three factors driving consumers to spend more online this year:

• Online vs. offline: Customers would rather shop online to take advantage of the sales and to avoid crowds.
• Mobile commerce: Smartphones and tablets will likely make up 40 percent or more of traffic to a retailer’s site on the major shopping days as consumers get offers sent to them by email and check them out wherever they are. Still, conversion rates are fairly low, Mulpuru said.
• The economy: Overall, holiday retail estimates are extremely positive and consumer confidence scores hit a six-month high in October.

Still, the trend largely benefits online-only retailers, like Amazon, which means that physical retailers must come up with a plan to keep consumers coming to the stores or their Web sites.

Target and Best Buy are two of the big-box retailers that have committed to matching online prices to prevent “showrooming,” where people scan barcodes in the store to find better deals for the same product online. PayPal is also supporting price matching for customers who use the payment provider to make purchases. And Walmart is experimenting with same-day delivery in some markets to fuel its online transactions.

Mulpuru said she wasn’t sure if stunts like that would move the needle, but agreed that “the biggest reason why Amazon is gaining share is because of price, free shipping and doing it quickly.” She said Amazon is willing to subsidize those costs and to spend more to acquire and retain those customers. However, she said, there is some backlash from manufacturers. Companies like Samsung and Sony have started a universal price protection program, where they guarantee the same price no matter where you shop.

“That’s been long overdue,” she said. “There’s been a lot of monkeying around with what’s the right price. With mobile, price is transparent. Up until now, the manufacturer hasn’t had to enforce pricing.”

The San Jose, Calif., company on Thursday introduced a program offering customers cash back for any price discrepancies they discover on the products they buy through their PayPal account, including airline travel. PayPal is promising users as much as $1,000 in refunds each from money it has set aside for the promotion, which runs through the end of the year.

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Many believe the future of tracking purchases and making payments lies with near field communication technology or smartphone applications, but this Kirkland, Wash.-based company is betting on something much lower tech: Text messaging.

“It’s not only because not everyone has a smartphone, but in a high-volume restaurant, or coffee shop, they don’t want someone fumbling around or holding up the line,” said James Sun, CEO of Pirq. “Text messaging is very fast, and it’s supported by all phones, including feature phones.”

Pirq became well-known this summer after announcing a partnership with Apple to bring an exclusive set of restaurant deals to all of its employees in Silicon Valley. But that was just a side deal to get the start-up some buzz. The company’s core business is in running loyalty programs for any small business. Many others are competing in the space, including Groupon, Belly and FiveStars.

Pirq takes a slightly different approach. For $50 a month, it gives each merchant an Android tablet to place on their counter. From there, consumers can scan a bar code using the Pirq application on their iOS or Android phone, or they can choose to send a text message to the short code displayed on the screen. Because they have a choice, consumers don’t have to take the time to download a new application, or even register — two big hurdles for adoption.

Merchants also have a choice on what to offer loyal customers. They can either reward consumers who hit a certain spending threshold, or they can send consumers a text message to promote a deal during off-peak hours, when business is slow. “There’s a big trend right now,” Sun said. “[Merchants] don’t want to discount the brand to the public. They are private deals for existing customers.”

Merchants pay $50 a month for the service, and from 50 cents to $6 for each reward redeemed. Costs vary depending on the service, ranging from cups of coffee on the low end to spa services on the high end.

The second round of funding was led by Rally Capital, and brings the company’s fundraising total to $3.2 million. The funding will go toward rolling out the company’s new text messaging program. Sun said that the service will be live in 70 stores in Seattle and San Francisco by the end of next week. The company plans to raise a larger round next year to hire sales people to expand nationwide.

The retailer said it also expects results of the quarter ending Nov. 3 to be as bleak as those in the three months ended Aug. 4, when profit plunged 91 percent, sales fell 3.4 percent at stores open at least 14 months and profit margins contracted by a percentage point. The Richfield, Minn., company will report earnings on Nov. 20.

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Like Best Buy Co., which last week announced similar plans, Target is seeking to combat “showrooming” by shoppers who check out products in its stores but buy them on competitors’ Web sites, often at lower prices.

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The electronics chain also is preparing to offer free home delivery on merchandise that is out of stock in stores, according to a person familiar with the matter, in spite of recent remarks by new Chief Executive Hubert Joly that “showrooming” by consumers has been blown out of proportion.

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From where he sits now, high-tech companies surround him: Zynga is across the street, and Airbnb will soon move in upstairs. But even though the young professionals are buzzing all around him, they rarely patronize his store.

Based on watching his four twentysomething children, Padis says he understands why: “Literally, all of their processes start online,” he said. “A great deal of young people don’t even think of walking into a store to make their decision and purchase.”

That reality is hard for most local retailers to swallow. Online retailers continue to gobble up local sales with the lure of convenience and, often, cheaper prices. In the jewelry business, the main opponent has been Blue Nile, which got its start selling engagement rings online back in 1999, and now operates as a lucrative publicly held company.

But instead of bemoaning this trend, Padis now hopes to benefit from it by partnering with a new e-commerce site that is launching today.

Ritani, a New York-based designer of engagement rings and other jewelry, is unveiling a new way to buy engagement rings that unifies both the online and offline shopping experiences. Under the new model, consumers will be able to purchase an engagement ring from the Web site and have it delivered directly to their home. Or it can be sent to a local jewelry store, where they can decide whether to buy it or return it.

The new business marks a major transformation for Ritani, which quietly got started about nine months ago with $15 million in funding led by Cantor Ventures.

As part of the overhaul, it hired a 20-person e-commerce team in Seattle, and named Brian Watkins president. Watkins, who previously worked at Blue Nile and Nordstrom, said the first-generation of online engagement stores, like Blue Nile, are missing out on the opportunity to offer personal service. He estimates the engagement ring business at $60 billion annually, of which less than 10 percent occurs online today.

Watkins said Ritani is going after the substantial percentage of people who like shopping online and doing research online, but are uncomfortable with buying one of the biggest purchases of their life without seeing it first. “That’s the gap we are going after,” he said.

Ritani’s main purpose, however, is not to take away sales from local retailers.

Generally, you can think of local jewelry stores as an extension of Ritani. Customers can create a custom engagement ring online and have it delivered to a local jeweler, without any obligation to buy it. Since Ritani is a manufacturer, rings can easily be sent back to its New York plant, where the metals will be melted down and the diamonds will find new settings. Every order offers free overnight shipping and a 30-day return policy, no questions asked.

That’s the process that the customers will see, but on the back end, Ritani has formed tight partnerships with local retailers to make it work. The most complicated part is in the revenue share: Ritani will share a percentage of every sale made within a certain distance of a jeweler, regardless of whether it played a role in the sale. Likewise, if that customer ends up patronizing that retail store in the future — to service a ring or to buy a watch — the retailer must share a percentage of the revenue back to Ritani.

“If you truly believe in integrating the online and offline experience, then putting people out of business is not good,” Watkins said from the company’s Seattle offices, which are a short drive from Blue Nile, his old employer and new competitor.

For Padis, it was easy to say “I do”: “These are customers that we otherwise may not have seen. I like the idea of a revenue share; it eliminates the animosity between online and offline retailers. We are cooperating.”

In addition to working with Steve Padis Jewelry, Ritani has partnered with a handful of other stores for today’s launch: London Jewelers in New York; Underwood Jewelers in Jacksonville, Fla.; Fink’s Jewelers in Virginia and North Carolina; Bachendorf’s in Dallas; and Brown & Co. Jewelers in Atlanta. More territories will come as Ritani expands the number of jewelers it works with. It plans to lean heavily on the 380 stores that sell its jewelry today.

In addition to setting up the back-end infrastructure, the company also had to completely redesign its Web site. Previously, it was just a catalog of rings; now, it has the look and feel of a glossy magazine with joyful pictures of newly engaged couples. Watkins said they were also careful to create some balance, so the site was attractive to both women and men. For men, that meant having a heavy spreadsheet component, where diamonds could be compared side by side. Other features include high-end photography and videos that offer 50-times magnification of the diamonds. There’s also a service called “Virtual Gemologist,” which provides one-on-one consultations with diamond experts.

Watkins said all those steps are necessary in order to make customers comfortable about buying online. Even as the head of merchandise at Blue Nile, which is the largest diamond buyer in the world, he would order four diamonds and inspect each one before selecting the very best.

Mr. Muehlbauer, who joined the company in 2002, will stay with Best Buy through the end of the 2013 fiscal year. The company said it has launched a search for a successor.

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Today, the directory has about 200,000 restaurants, cafes and bars out of the more than two million individuals and businesses that are registered to accept credit and debit card payments using Square.

When looking at a map, that visually translates into a couple dozen shops in cities like downtown Seattle or Boise, Idaho. In San Francisco, where the company is based, there are even more.

Consumers will be able to use the directory to view menus, find deals and specials at restaurants and pay using the Square Wallet app, which consumers download to the mobile phone and where they store their payment card information. While the site doesn’t have Yelp-like reviews, some merchants do make recommendations on what to order and offer rewards, like 50 percent off your first purchase or 10 percent off every sixth visit.

If you think the number of locations where Square is accepted is sparse, keep these two things in mind: Square is already processing more than $8 billion in payments on an annualized basis, and soon it will be uploading every Starbucks into its directory based on a recent partnership it signed with the mega coffee conglomerate.

The program was first discovered by Channel Advisor, after Amazon sent detailed letters to merchants about the program. Channel Advisor provides tips to merchants, who sell items on marketplaces like Amazon and eBay. An Amazon spokesperson did not return phone calls seeking comment.

In the letters, Amazon said the new service, called Amazon Lending, can be used to “purchase inventory and increase your sales on Amazon.com.” If a merchant is approved for the program, the funds will be advanced to their Amazon Seller account within five days, and then a monthly fee will be automatically deducted from the merchant’s account.

While many consumers may think that everything they buy on Amazon comes directly from the retailer, in many cases it is coming from independent sellers, who choose to list their products on the marketplace for more visibility. Amazon collects 99 cents a sale, plus a percentage of each transaction if a merchant is selling fewer than 40 items, or $40 a month plus a revenue share if they are selling more.

By lending capital to its sellers, Amazon may be able to help merchants increase their sales, since one of the many constraints they face is having access to capital. This can be especially true ahead of the holidays as merchants stock up on inventory to meet additional demand. The loans, however, won’t come cheap. According to Channel Advisor, several merchants were offered an interest rate of 13 percent.

Other companies, like Atlanta-based Kabbage, serve online merchants, which typically have a hard time getting attention from traditional lenders. Kabbage, which has raised almost $50 million in venture capital, has now lent money to sellers — mostly on eBay, Amazon and Yahoo — that earn a combined $800 million in annual sales.