As disco became an important part of the international music business, European producers began working in exotic flavors into the disco beat to create unique and competitive recordings. A good example of this trend is Santa Esmeralda, a Spanish-themed studio group that wove elements of flamenco, salsa, and other Latin musical styles into its Euro-disco sound. Although the group's sound was about as genuinely Spanish as Herb Alpert & the Tijuana Brass (Santa Esmeralda was the brainchild of French record producers), the result was a crossover success that spawned several club-favorite albums and a notable pop hit in the band's Latinized cover of "Don't Let Me Be Misunderstood".
The Mailman decides to answer some of the most common questions about Santa Claus, and tells us about a small baby named Kris who was left on the doorstep of the Kringle family (toymakers). When Kris grew up, he wanted to deliver toys to the children of Sombertown. But its Burgermeister (Herr Meisterburger) is too mean to let that happen. And to make things worse, there's an evil wizard named Winter who lives between the Kringles and Sombertown, but Kris manages to melt Winter's heart (as well as the comely schoolteacher's) and deliver his toys.
After introducing how Santa and Mrs. Claus came to the North Pole and began their work delivering toys at Christmas time, this routine children's film segues into a story about an evil corporate magnate (John Lithgow). One of Santa's elves (Dudley Moore) goes to work for the nasty tycoon and invents a wild array of far-out toys. Then there is a little boy who does not believe in Santa Claus and a girl who finds out about the toymaker's plans to defraud his company. Santa's reindeer are a little under the weather, not to mention Santa himself. This labyrinth of subplots quickly draws attention away from the story, wherever it is.