Rudolph: The Story of a Discount Department Store That Created a Christmas Empire
by Prometheus Capital
Introduction: A Christmas Icon Born from Commerce
Each season Rudolph the Red-Nosed Reindeer is visible throughout the Christmas marketplace—on jumpers, decorations, gift wrap, music collections, advertisements, commercials and plastic figures in malls spanning from New York to Seoul. He is as crucial to the holiday’s imagery, as Santa Claus himself.
However here comes the twist:
Rudolph is not folklore.
He is not mythology.
He is not ancient tradition.
He works in marketing.
The retail powerhouse Montgomery Ward brought him to life in 1939 as a cost-cutting tactic—one that inadvertently gave rise to one of the most lucrative, iconic and lasting holiday figures, in history.
This is the remarkable entirely factual tale of how a corporate marketing project turned into a billion-dollar Christmas symbol—and what it uncovers about the role of storytelling, branding and emotional economics, in shaping the holiday market.
The Challenge of the Great Depression: Why a Retail Chain Required an Affordable Christmas
During the 1930s Montgomery Ward stood as the leading catalog retailer in the United States and held a significant presence in every city shopping area. Its massive stores and vast mail-order system delivered a range of goods from toys to agricultural machinery to households, across the country.
However by 1939 the firm encountered an issue:
Each December it bought thousands of made childrens Christmas coloring books from outside publishers to distribute as, in-store holiday presents.
These promotions worked well—they attracted families to the stores, built feelings and gently influenced childrens gift desires, toward products Montgomery Ward offered.
However the issue was the expense.
Purchasing these books from publishers reduced the holiday advertising funds. In the Great Depression every cent counted. Profit margins were narrow. Consumer expenditure was careful. Even large corporations sought ways to optimize.
Thus the leaders devised an ordinary instruction:
“We are overspending on Christmas books for children. Year let’s make our own.”
There was no grand creative ambition.
No desire to shape culture.
No intention to create an enduring holiday myth.
The focus was on conserving funds—lowering, per-unit expenses, managing material and employing innovation to boost ROI.
Occasionally even minor expense-cutting actions unintentionally ignite transformations.
The Assignment: A Copywriter, a Deadline, and a Blank Page
Enter Robert L. May, a soft-spoken, bespectacled 34-year-old copywriter working in Montgomery Ward’s advertising department.
May possessed talent yet remained modest—a major passionate about literature and childrens tales. However his private life was unraveling. His wife was seriously sick, with cancer medical expenses were immense. He felt crushed by sorrow and monetary pressure.
When his manager gave him the task—“compose a Christmas tale for our booklet”—May at first hesitated. He was too tired, emotionally spent, too burdened by life to come up with something playful, for kids.
However writing was his possession.
Thus he started.
He desired a character who stood out from the crowd.
Someone small.
Someone ridiculed.
Someone was neglected.
An individual who eventually demonstrated their value.
It mirrored his emotional condition—May eventually confessed that he strongly related to the sensation of being undervalued.
He researched Santa’s reindeer. He experimented with names such, as "Rollo" and "Reginald." Eventually he chose a being whose unique trait—something that might have been a drawback—turns into his advantage:
A reindeer with a bright, glowing red nose.
Initially Montgomery Ward’s leaders doubted the idea. In 1930s culture a red nose symbolized alcoholism. However May was adamant: this wasn’t humor—it represented a metaphor, for accepting your uniqueness.
It received their approval.
The tale was dispatched for printing.
The 1939 Launch: How a Complimentary Pamphlet Turned into a Festive Occasion
For the 1939 Christmas season Montgomery Ward produced 2.4 million editions of Rudolph the Red-Nosed Reindeer.
The result was explosive.
Parents requested copies.
Children regarded the tale as a gem.
Newspapers covered the story of the " reindeer, with the unusual nose.”
Families voice it during Christmas get-togethers.
The pamphlet lacked a price label.
No promotion was necessary.
It wasn't necessary to position it.
The power was in the story—and the fact that it was free.
In economics ease of access speeds up adoption.
When there is no cost the barrier, to entry vanishes.
Rudolph circulated like a primitive example of viral content.
Although World War II paper scarcities temporarily halted large-scale production by 1946 Montgomery Ward circulated a 3.6 million copies increasing the overall total to millions, beyond that.
Rudolph had evolved beyond marketing.
He turned into a figure.
The Surprise: The Firm Donates a Gold Mine
In an action that would seem impossible nowadays Montgomery Ward executed one of the surprising and magnanimous corporate choices, in the history of marketing.
In 1947 the firm returned Rudolph’s copyright, to Robert L. May.
They just gave him the character—no licensing charges, no share of royalties no ownership.
Why?
Executives believed May, who faced difficulties following his wife’s passing had a right to possess the character he invented. It was an act entirely, unlike standard profit-driven conduct.
By making that one choice Montgomery Ward possibly lost millions—. May obtained a chance that transformed his life.
Now Rudolph wasn’t just a store giveaway.
He was intellectual property.
He was a brand.
He was a business.
And to build that business, May brought in someone with a particular set of skills.
The Tune That Transformed It All: Johnny Marks Steps Into the Spotlight
In 1949 he composed a song.
A simple, melodic, heartfelt Christmas tune:
“Rudolph the Red-Nosed Reindeer.”
It was turned down by record labels.
Vocalists declined it.
Executives mentioned it seemed immature.
Critics claimed the words were overly basic.
Then Gene Autry—the “Singing Cowboy”—gave it a chance.
The track was released in December 1949. Exploded in popularity nationwide. It turned into the Christmas hit, in America with sales exceeding 2 million copies during its initial holiday season.
Currently it continues to be, among the selling tracks ever.
That tune transformed Rudolph from a marketing symbol into a holiday icon.
Rudolph's Industrialization: The Transformation of a Character, into a Product Series
Following the song’s popularity the Rudolph economy boomed.
The character was authorized by manufacturers.
Plush Rudolphs were sold by toy manufacturers.
Holiday displays were created by department stores.
Publishers released storybooks.
Every December radio stations repeatedly broadcasted the song without stop.
Rudolph emerged as one of the successful instances of cross-media and cross-product marketing worldwide.
He was no longer a single creation.
He was a portfolio.
Traditional IP economics came into play:
Merchandising → Retail → Broadcast → Publishing → Performance → Licensing → Cultural permanence
By the 1960s Rudolph had evolved into a fully developed commercial entity—a figure, with a coherent brand image, product associations and timely seasonal significance.
However his pivotal moment was yet to come.
The 1964 Rankin/Bass Special: The Stop-Motion Miracle
In 1964 Rankin/Bass Productions—experts, in stop-motion "Animagic" animation—created a one-hour TV special called:
“Rudolph the Red-Nosed Reindeer.”
Nobody anticipated it would become a success.
Budgets were small.
Stop-motion progressed at a pace.
Animation was expensive.
Television specials were experimental.
However all elements aligned flawlessly:
• Burl Ives provided narration for the movie, with friendliness and appeal
• The music was memorable
• Rudolph’s emotional journey was skillfully portrayed
• The stop-motion technique added depth and enchantment, to the narrative
When broadcast on NBC it fascinated kids, families and established Rudolph as a festive symbol.
The special turned into the standing yearly Christmas TV event, in American history broadcasting annually for many decades and evolving into a tradition spanning multiple generations in countless homes.
Rudolph was no longer just a character or a song—he was a ritual.
Rituals possess influence that advertising budgets can merely aspire to.
The Economics of a Christmas Empire
During the 1970s and 1980s Rudolph symbolized a holiday enterprise network with branches:
-
Merchandising revenue
Toys, figurines, stuffed animals, ornaments, board games. -
Licensing agreements
Retailers incurred charges to utilize the character. -
Broadcast rights
Networks paid annually to air the classic special. -
Music royalties
Every year the song produced income roughly in December. -
Publishing
Fresh releases, editions, commemorative versions. -
Branding partnerships
Rudolph was featured by corporations, in their holiday advertising.
Rudolph turned into a powerhouse—a figure that caused an annual surge in income, during the holiday period.
Like Christmas itself Rudolph turned into a reliable element of the yearly consumer routine.
Lessons from Rudolph, on Business, Branding and the Festive Market
Rudolph’s tale isn’t merely delightful—it’s tactical.
It holds insights, for business executives, marketers, innovators and economists.
Lesson 1: A great story is the most powerful marketing tool on Earth.
Montgomery Ward unintentionally originated a Christmas legend—since narratives expand effectively than advertisements.
Lesson 2: Emotional connection surpasses marketing tactics.
A narrative centered on an underdog will consistently surpass festive goodwill.
Lesson 3: Intellectual property is a long game.
Rudolph’s worth increased dramatically over the years.
Lesson 4: Complimentary material can generate enduring gains.
The pamphlet was free—. That facilitated its distribution.
Lesson 5: Christmas is one of the most competitive markets in the world.
Festive figures function similarly to brands.
Tradition is the ultimate form of loyalty.
Lesson 6: Basic concepts expand globally.
Rudolph needed no modification—his message resonates across all cultures.
Lesson 7: Business philanthropy has the potential to generate benefits.
Montgomery Ward’s choice to return the rights to May enabled the franchise to flourish.
The Larger Picture: Holiday Icons Are Economic Powerhouses
Christmas is more, than a celebration—it functions as a multi-billion-dollar economic engine driven by sentiment, custom, nostalgia and marketing.
Figures such, as Rudolph turn into:
Recurring revenue streams
Marketing opportunities
Retail symbols
Cultural anchors
Merchandising giants
They are more, than characters.
These are resources—items that renew every year.
Rudolph demonstrates how a straightforward tale made to cut costs can evolve into one of the lasting and profitable holiday franchises ever conceived.
He started out as a business memorandum.
He turned into a headline.
It developed into a sensation.
He evolved into a dominion.
In the crowded Christmas marketplace, attention is fleeting—but tradition is forever.
And Rudolph, the unlikely misfit invented to save Montgomery Ward a few dollars, used his glowing red nose to guide himself straight into economic immortality.
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