More than ever, home is where the heart is this holiday season, and Canadian retailers are responding to this consumer mind-set with sentimental campaigns revolving around family and tradition. They are also promoting home-based products, as analysts predict a ‘cocooning’ trend in the wake of Sept. 11 and the subsequent stormy economy.

Indeed, the holiday period looks bleak this year, with Toronto-based research company Market Facts, which surveyed 1,009 adults earlier this month, reporting that 38% of Canadians intend to dish out less cash on gifts and decorations this year, compared to only 18% who said they’d spend more.

But while retailers are trying to lure in customers with lower price points, they also hope to hook people’s emotions, at least in their TV campaigns.

This ‘tug-on-the-heartstrings’ approach unfolds at The Bay this season, which will debut three new TV spots this month that depict people hunting for the ‘perfect gift’ for a loved one. ‘The spots are not flashy – they’re about that special time during the holidays,’ says Neil Fedun, EVP marketing, who says the creative celebrates ‘family values,’ and portrays ‘real-life scenarios…with real people.’

Fedun admits current economic and social conditions, which have flattened consumer spending, were a motivation for the new campaign. ‘What’s going on globally has made everyone re-evaluate life and their priorities. We felt that we needed to communicate with this voice, because that’s where the customer would be more open to us.’

The ‘perfect gift’ initiative, also represented in flyers and catalogues, will trickle down to the merchandising level, he adds, where items like funky socks, candles and ornaments will be bundled together and wrapped in special holiday paper.

Meanwhile, research from focus groups suggested that large household items will be hot, propelling The Bay to develop a new concept called ‘Theatre in a box,’ whereby home theatre merchandise is packaged together and sold for one price.

‘There may be fewer gifts under the tree, but our customers are saying they may make investment purchases [because life] will be geared around quality time at home with families,’ says Fedun.

John Torella, a retail analyst with Toronto-based J.C. Williams Group, has similar predictions. He says home theatre, electronic items, and cozy fashions like cashmere and wool sweaters are all poised to do well. ‘We’re focusing on categories that people tend to respond to during difficult times,’ he says. ‘It’s going back to things that are relevant and important to people, that will help them live a better life.’

In the case of Canadian Tire, Eymbert Vaandering, VP marketing, says the retailer expects to ring up sales over Christmas this year in part due to its merchandise mix, including home-improvement items and holiday decorations, the latter of which are highlighted in a mini-catalogue called ‘Making Spirits Bright’. ‘We’re absolutely well-positioned in times like these,’ he says, adding that the company will run seven ‘demomercials’ that suggest gifts for do-it-yourselfers.

This is the first time in many years that Canadian Tire has dropped Scrooge from its broadcast communications efforts, although he will still appear in print flyers, where he will continue to push price points.

Earlier this month, Doner Canada launched the TV campaign, which includes a trio of ads: one where a young man writes a letter to his dad, reminiscing about the fun they used to have at Canadian Tire; another where a woman and her father share the memory of purchasing her first skates; and a third where a young boy speaks of the retailer’s Foundation of Families charity, which gives to those in need during the holidays.

The tag line is ‘great gifts come from Canadian Tire, but the greatest gifts come straight from the heart.’

‘We wanted to use broadcast to connect with customers,’ explains Vaandering. ‘[The commercials show] that Canadian Tire is not just a place to buy great gifts, but that it also gives back through memories of relationships with consumers and the community.’

And while the creative had been on the drawing board long before Sept. 11, Vaandering says ‘given the uncertainty in the economy, we think it’s a very effective campaign.’

The touchy-feely family vibe also resonates in Wal-Mart’s two holiday commercials, which coincide with its overall ‘real people’ strategy.

Produced by Montreal-based agency Publicis, one ad features a pregnant woman who talks about how she celebrates two Christmases each year – Ukrainian and Canadian – and the second stars a father whose son helps him select presents for his wife.

‘We think there will be a focus on spending time with loved ones, and increased popularity in everything for home, including home fashions and board games you would play as a family,’ says director of marketing Lou Puim.

These feel-good concepts are sound, according to Toronto-based retail analyst John Winter of John Winter Associates, who expects consumers will want to reminisce about Christmases past, in an attempt to forget Christmas present. ‘I would think the logical thing would be to play off the whole theatricality of the season, to get people remembering the Bing-Crosby-type Christmases we have had, so they can forget the Bin Ladens of the world.’

But not all retailers have adopted sappy tones this year. Burnaby, B.C.-based Future Shop, for one, opted for a more lighthearted approach. ‘Candy Cane Trail,’ which aired on TV earlier this month, portrays a guy who follows a trail of candy canes to the basement, where his wife has set up a home theatre for him. The suggestion is that her intentions are romantic, but he’s overjoyed by his new present.

‘It’s not to be taken too seriously, which we thought was kind of appropriate for this holiday season,’ says Jeff Schulz, VP, marketing and business development, who adds that the piece was shot in the summer. ‘The products offer a nice escape, and they’re something people get a great deal of enjoyment out of, so I didn’t feel a need to change our strategy.’

Meanwhile, Zellers has revived a humorous ad created by its current AOR Ogilvy & Mather, starring Eric Braeden, better known as the powerful Victor Newman on the soap opera The Young & the Restless.

In the first 15 seconds, Braeden pines over a woman who he is smitten with because she does so much for her family. The camera then pans out to reveal that he is sitting on Santa’s knee, while kids look on from a long queue.

In the second half of the ad, which was added this year, several products, such as ornaments, electronics and toys, flash across the screen. Another message for the chain is a ‘Don’t-pay-until-April’ plan. ‘For us in the mass category, this is an advantage because our competitor doesn’t have access to deferred credit,’ says David Strickland, SVP marketing.

The fact that some retailers are folding a pricing component into their campaigns is no surprise, particularly since Canadians love bargains even in prosperous times, says retail analyst Richard Talbot, who heads Unionville, Ont.-based Talbot Consultants.

However, Talbot, who forecasts holiday sales will creep up by only 2% this season over last, warns it won’t help them stand out from their foes. ‘They need to focus on unique, one-of-a-kind products to differentiate themselves, and market the hell out of them. We’ve evolved toward bland, across-the-board offerings. It’s those who are different, like Roots or Future Shop, that will do extremely well.’