Can The Santa Experience Save Brick-And-Mortar Retail This Holiday Season?


Some holiday traditions are easy to explain — things like wrapping presents, drinking hot chocolate and baking cookies are all neatly summed up with the knowledge that the vast majority of people like opening presents and eating cookies. Other traditions are a bit harder to understand — baking or buying fruitcake and singing “The Twelve Days of Christmas” spring to mind. Less than 1 percent of the human population likes fruitcake. And the number of fruitcake enthusiasts in the world roughly doubles the number of people who know any words to “The Twelve Days of Christmas” past the fifth verse.

Before the hate mail rolls in — yes, we know there are people who love “The Twelve Days of Christmas” and we are aware that many people do actually know the words. And for the fruitcake lovers out there — yes, we know  there are some delicious and inventive versions out there, too. Bloomberg reports that there is a group of Trappist monks in Kentucky who are changing the face of that dessert with their whiskey-soaked handmade fruitcakes.

At any rate,  given that both these holiday traditions are mocked more often than praised, one can start to wonder how it is possible that both have been around since the 1700s and have thus managed to make appearances at roughly 300 Christmases apiece. Not bad work for a dessert no one likes and a song no one knows all the words to.

But then there is the part of Christmas that almost no one needs an explanation for because like instant push payments, mobile order-ahead and Baby Yoda merchandise, the concept itself is so evidently appealing to anyone who knows what the terms means needs no further explanation.

We are talking about Santa, of course, specifically the tens of thousands of Santas nationwide appearing in malls, in department stores, at hospitals and serving as guests of honor at breakfasts and brunches as they make their annual holiday rounds. Onto their laps millions of kids from 1 to 92 will be hopping to whisper what they want and then smile for a quick photo.

It's a generational tradition in the U.S., and as much as holiday traditions in the U.S. have changed, it is almost remarkable how getting a photo snapped with Santa has not. In fact, it seems the tradition in 2019 serves the same purpose in did in the 1840s when it first started — a purpose that it is perhaps more critical than ever:

Getting customers out of the house and into the stores. 

Santa: The Original Experiential Retail Strategy

Santa showing up in retail marketing, as far as historians can tell, dates back to the 1840s when some stores went as far as putting up life-sized models of jolly old St. Nick in their windows to appeal to children. But the first “real” live Santa first showed up in 1870 when department store owner James Edgar began making live appearances as Santa in his store. His idea was simple — invite kids to come in, snap a photo with Santa, ask them what they want and then refer their parents to the section of the store that sold precisely that thing.

Edgar’s innovation in experiential retail was an instant hit — and by the early 1900s was widely imitated in department stores all over the nation. By 1924 Macy’s launched a Thanksgiving Day parade that ended with its New York City store Santa officially ushering in the holiday season. By the mid-20th century Santa’s importance to Christmas retail was so fully ingrained it was actually the subject of a feature length Hollywood movie: “Miracle on 34th Street.”

And while much has changed in retail, Santa’s popularity has not. In fact, it is growing.

GigSalad, a digital platform for booking entertainers for private parties and events, says Santa is always its most popular request and also the hardest to fulfill.

“We can never fulfill all the requests we’re getting just because we don’t have enough Santa’s,” Megan Price, director of customer experience at GigSalad, told CNN.

And 2019 has been particularly full, with confirmed bookings for Santa up 128 percent over the last four years, according to Price.

“The number of Santas we have on the site has grown about 102 percent over the last four years,” Price said, noting that even with more reserves, there just isn’t enough Santa to go around. “People come every year and say they want to book a Santa. Usually we run out fairly quickly.”

Plus Santas are not simply in bigger demand this year — stores and malls featuring Santa are thinking big when it comes to where they place him.

Especially if you live in New Jersey.

The Mall at Short Hills in Millburn, New Jersey unveiled not just Santa, but his whole “Flight Academy” — a 3,000 square-foot holiday-themed playland that lets children take pictures with Santa, try on virtual flight suits, play with the sleigh and participate in a snowfall dance party. Not to be outdone, the American Dream mega mall in East Rutherford, N.J. has built an entire “Winter Wonderland” for parents and children to explore before they sit down with the big man for photos and toy requests.

Stores are taking Santa so seriously, explains Amanda Nicholson, professor of retail practice at Syracuse University's Whitman School of Management, because in the era of eCommerce Santa is serious business for these stores looking for any advantage when it comes to bringing shoppers into their stores this season — and giving them a very good reason to spend while they are there.

“We can't go on Amazon and put our child on Amazon's knee and put a beard on it,” Nicolson said — doubtlessly giving the R&D team at Amazon something to think about overcoming in 2020.

And, of course, being Santa is big business for some Santas as well — particularly as demand rises.

The Business of Being Santa 

Santas can make some reasonable money during the holiday season — GigSalad reports its Santas for private engagements run about $200 an hour for a Santa appearance. Mall Santas, however, don’t make quite so much. While there are highly lucrative, high-traffic malls that pay for seasonal work in five-digit amounts, the average mall Santa pay ranges from $4,000 to $5,000 total — or about $10 to $13 an hour (Santa works, usually, for 54 days on average for eight hours a day).

During their shifts, the average Santa will talk with 60 children in an hour, and about a third of them will have the enviable experience of a child having an “accident” in their lap. And, of course, Santa has to provide his own gear. A low-cost Santa suit will run on about $70 on Amazon — though Georgia mall Santa Jim McGrath told PYMNTS that in general any self-respecting Santa will spend several hundred dollars on the purchase of a “quality and authentic looking suit.”

McGrath also noted that being Santa is also his highest annual cosmetic expense — as he dutifully travels to a beauty salon every Halloween to have his beard professionally treated to the appropriate shade of silvery, snowy white. He makes some money on the holiday every year, he said, but not much, nor do the vast majority of Santas. At best most break even, he said, and sometimes even come out a few hundred dollars behind.

But while having him portray Santa may be about business for the stores that hire him, he’s not in it for the money. He’s in it for the love of the game — and the occasional chance to make something magical happen. McGrath told PYMNTS that this week while waiting in line, one parent approached him to let him know that his daughter didn’t want a toy, she just wanted to know if Santa ever baked pumpkin bread.

“Fortunately, not only is my pumpkin bread in demand internationally, but I had brought a batch of small loaves to share with set staff and had an extra,” McGrath said. “The set manager was able to go to our break room and retrieve it just as the girl arrived at the chair and asked her question. As if on cue, I pulled the wrapped loaf out and gave it to her and encouraged her to pursue her baking passion.”

And while he didn’t say for sure, we feel certain those parents didn’t leave the store without buying an apron, a cookbook and an EZ Bake oven for that kid from Santa for Christmas this year. Because if there were ever a more clear context for commerce, we are not sure we are ever going to see it.

Well, until Amazon starts having people in Santa suits start hand-delivering all their gifts, anyway.



About: Accelerating The Real-Time Payments Demand Curve:What Banks Need To Know About What Consumers Want And Need, PYMNTS  examines consumers’ understanding of real-time payments and the methods they use for different types of payments. The report explores consumers’ interest in real-time payments and their willingness to switch to financial institutions that offer such capabilities.