What Would Happen If Santa Charged for Presents? A Fun Look at Holiday Economics
Written by
Dawn Allcot
Edited by
Jenna Klaverweiden
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Every year, debates emerge about holiday shopping, especially in Facebook mom’s groups and mom-focused TikTok channels. Parents argue that Santa shouldn’t give gifts like an Xbox Series X or Nintendo Switch 2 because he doesn’t give one to every child.
This leads to questions from children about why Santa brought their friend a new electric scooter and they received a dollar store Barbie doll. Empathetic parents started labeling the “big ticket” items from themselves and smaller gifts and stocking stuffers from Santa. That leaves fewer awkward questions for kindergarten teachers.
But the question of that Target sticker on that exclusive Barbie or Marvel set under the tree perseveres. Hasn’t every parent has left a price tag or store label on a gift at one point? “The elves can’t make everything, so sometimes Santa has to shop at the same stores we do to find the presents you want.” That’s the standard line. But what if Santa really did shop for name-brand presents and pass the costs onto parents?
Also see four budget tweaks to make now for holiday shopping.
What If Santa Ran the North Pole Like a For-Profit Business?
Santa delivers to more than 526 million children across the world on Christmas Eve, according to a Time report of “Santa-eligible children under 14.” That figure is from 2018, and some parents keep the magic alive even longer, so the actual number of “Santa-eligible” children could be in the billions.
At peak times, like Prime Day, Amazon receives 188 million orders per day, according to CapitalOne Shopping. Santa’s task is not impossible, especially with Christmas magic and Rudolph guiding the sleigh.
Forget Jeff Bezos and delivery drones. The jolly old elf would have the largest e-commerce operation in the world, powered by reindeer.
How Would Santa Structure the Business?
Successful e-commerce companies today give Santa several playbooks to follow. He can charge per gift. Offer subscription tiers. Charge surge pricing on Christmas Eve. And even build a loyalty program based on those famous “naughty” and “nice” lists.
It’s hard to think of Santa as a billionaire, even though his business could easily rival Amazon’s quickly and he’s got a large, captive audience.
Let’s assume he’s supporting his elf workforce with excellent benefits and more than three-quarters of the year off (crunch time is Black Friday through Christmas morning). He’s keeping the Christmas lights on and the reindeer well fed. How would he manage the rest of his money?
Because he’s buying in massive quantities during a compressed time frame, he probably gets even better pricing than Costco. President Donald Trump tried to introduce tariffs on uninhabited islands in the South Pole during his first term, according to The Guardian. So far, however, the North Pole seems safe. Tariffs are not driving prices up for Santa.
Parents would likely pay Santa about the same as they pay at Costco or Walmart, but Santa’s pricing would include wrapping and the all-important chimney delivery. No late night scrambling for parents to get the presents under the tree.
Per Gift
Santa’s base model would probably be per-gift, with a small upcharge for wrapping with a custom tag in his handwriting.
He probably buys his paper from Costco, just like so many savvy shoppers, or maybe even secures the prices Costco pays distributors. A two-roll pack of wrapping paper from Costco wraps roughly 60 to 80 gifts, so that’s about $0.50 per package at the midrange. Santa could take a 100% markup ($1) to cover overhead, earning $2.63 billion per year just on wrapping paper if each child receives five gifts.
The parents’ cost per toy depends on if they’re purchasing a Switch 2 or a $20 Lego set. If Santa took a markup on toys, he could add just 10% to his prices, still giving parents a good deal.
Christmas is big business. However, he’s still Santa, so he wants to make sure he’s delivering the best value.
Subscription Tiers
Have multiple kids? Santa could have a subscription that offers 10% off for every three items on your list, much like Amazon subscription services.
He might also offer discounts for a long-term commitment. Five gifts per kid for 10 years, and you’re locked in at a flat rate for average-priced gifts. Any additional costs for higher-priced items, like an Xbox or the $1,000 Lego Star Wars Death Star kit, parents would cover.
Surge Pricing
Last-minute shopper? Kids didn’t get you their list until Dec. 20, when it’s long past Cyber Monday or any chance of snagging deals?
Following the model of Uber, Santa could charge surge pricing. The higher pricing the week of Christmas rewards families who plan ahead and helps Santa’s workshop workflow. It’s also grounded in reality. A recent study from Gourmet Gift Baskets found that, in 2024, gift search interest peaked 38 days before Christmas.
“Shoppers are starting earlier because that’s when the real savings happen,” said Ryan Abood, CEO of Gourmet Gift Baskets.
Like retailers who don’t have as many sales in mid-December, Santa could charge a nebulous added fee for requests that come in on Christmas Eve, so make sure your kids get their letters in early.
Santa’s Loyalty Program aka the Nice List
Like so many smart business owners, Santa would probably create a loyalty program, known as the “nice” list.
He might provide discounts or free last-minute requests to kids who reach the nice list by not fighting with their siblings, keeping their rooms clean and other positive behaviors the ubiquitous Elves on a Shelf observe.
Impact on Family Holiday Budgets
In reality, parents already have to pay for “Santa’s” gifts or any holiday presents. Paying Santa wouldn’t be much different from paying Amazon, Walmart, Costco or Target. Those who make more could spend more. That wouldn’t change.
The difference is Santa could, and probably would, put the money he’s earning on toy markups, wrapping and surge pricing available to help families who don’t have as many, or any, gifts under the tree. After all, he embodies the spirit of giving.
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