• by Gavin O'Malley  @mp_gavin, November 29, 2010

Amid unprecedented online holiday spending, Millward Brown wanted to know what keeps physical stores afloat -- and by extension, what online retailers can do to capture even more market share in the future. The answer to the first question? Atmosphere, inspiration, thoughtfulness, and the almighty "touch" factor, according to the WPP research unit.

Among 1,000 adults surveyed online earlier this month, 49% said they like the ideas they get while browsing in physical stores, while slightly fewer -- 42% -- said they enjoy the atmosphere of stores during the holidays. Meanwhile, 22% expressed a belief that the act of personally going to a store to buy something adds value to the gift.

"Brick-and-mortar retailers enjoy advantages that are hard for online retailers to overcome," said Ann Green, SVP of marketing solutions at Millward Brown. "No description of cashmere can match the sensation of actually feeling it, and the inspiration people gain by shopping in physical stores cannot be ignored."

So, what are the implications for brands and retailers, with a real-work and/or online presence?

For brands, according to Millward Brown, distribution through physical retailers will net sales that might not be realized online. Also, prime display space is worth fighting for, while, wherever possible, brands should give people a chance to touch their products.

Retailers, meanwhile, should do their best to bring shoppers into their stores and keep them there. One of the best ways to do this is by investing in seasonal promotions, activities, and entertainment.

Retailers should also know their customers, and know how they celebrate the holidays.

"Macy's is one of a number of retailers that has adopted a localization strategy," according to Millward Brown. "Retailers should likewise strive to understand the holiday traditions of local shoppers, particularly their own clientele."

Overall, no chain can afford to ignore the sense of locality afforded by specialty stores and boutiques, Millward Brown concludes.

Ecommerce spending for the first 21 days of the holiday season exceeded $9 billion, marking a 13% increase over the same period last year, according to comScore.

For the entire 2010 holiday season, comScore predicts that online sales revenue will reach $32.4 billion, representing an 11% gain year-over-year. Better still, this strong growth rate represents an improvement compared to last season's 4% increase.