Why Santa is a marketing genius

Just think, a jolly fat man in a red suit gets billions of people to spend billions of dollars on people they may only see once a year to commemorate someone else’s birthday. This guy’s a genius!

If you are looking for an example of behavioural economics, look no further than Santa. The man himself may be a fiction, but our irrationality is all too real.

Santa, (and by Santa I really mean the rituals of consumerism associated with Christmas) influences us to do things that make no rational economic sense such as:

Buy more food than we can possibly consume

We find ourselves gorging at tables laden with every type of meat and vegetable as hosts delight in showcasing their generosity. Such is the social construct that serving a normal sized meal just isn’t Christmas.

Buy Christmas trees

We drive to a Christmas tree supplier, buy a $30-$60 tree that at any other time of the year we would not even look at and will survive only a few weeks, strap it to the roof of the car, drag it into the house, throw specially bought plastic bits all over, gather around the tree and distribute gifts. The next week, we watch the tree slowly turn brown before cutting it up to fit in the green waste bin.

Buy snow

In Australia, in summer, we (not me of course) buy snow in a can to spray on windows. Meanwhile we listen to special compilation CDs that trill about snowmen, sleighbells, and white Christmases. Rational on a 30 degree day?

Buy wrapping paper

We buy fancy paper to wrap gifts that are already packaged so that we can watch the wrapping get torn off on Christmas morning.

Avoid vouchers… unless we really have to

We worry about the stigma of giving cash or a voucher rather than a “gift” even though the voucher may actually be worth more. Retailers are working hard to de-stigmatise vouchers and experiential gifts like RedBalloon are helping reshape perceptions of these gifts.

Go to the supermarket… repeatedly

We tend to freak out that the shops close for one day and so pop into stores to get extra supplies just in case, forgetting the jammed car park and queues at the check-out.

Boxing Day sales

The news footage should speak for itself but just to remind yourself not to let the thrill of a discount overwhelm your sense of dignity, check out scenes from the Thanksgiving sales in the US where a $2 waffle maker provoked a gobsmacking frenzy.

Why do we find ourselves behaving this way at Christmas time?

Well, marketing probably has a lot to do with how we behave at Christmas. “Special” Christmas deals, scenes of harmonious family gatherings and directive suggestions like “buy this TV for your Dad” use reciprocity (give to receive), loss aversion (make sure it’s a fair value exchange by buying expensive gifts), and social norms (everyone is doing it) to incite us to purchase. That our understanding of red-suited and jolly modern Santa is a marketing construct confirms how persuasive marketing can be, but it is more than that.

We are more influenced by how others act; the values and behaviours displayed by our fellow human beings. That’s why shoppers went into a contagious frenzy for a $2 waffle maker, and why the rest of us, from the comfortable distance of our computer screens, feel we can mock them for their irrationality.

But that’s also the great thing about Christmas; a tacit agreement across much of the globe to devote one day to sharing time and tokens with loved ones. Irrationality at its rational best. Have a good one, and thank you Santa.

This article was first published on December 12, 2011. 

Bri Williams runs People Patterns Pty Ltd, a consultancy specialising in the application of behavioural economics to everyday business issues. Bri is a presenter, consultant and author who you can find out more about at www.peoplepatterns.com.au, viabri@peoplepatterns.com.au or by following on Twitter @peoplepatterns. Bri’s book, “22 Minutes to a Better Business”, about how behavioural economics can help you tackle everyday business issues, is available through the Blurb bookstore.