Over the years its Christmas adverts have featured a menagerie of lovable creatures but this year John Lewis is tugging on heartstrings with a Narnia-inspired tale of two sisters that for the first time gives its struggling department stores a starring role.

After last year’s lighthearted outing featuring a cheeky Venus flytrap, the ad is a distinct gear-change. It was filmed in John Lewis’s high-profile store on Oxford Street in London and, at a time when the high street is facing severe headwinds, for once it is actually about going Christmas shopping – without a lovable penguin or snowman in sight.

The set-up is also a lot more traditional than in previous esoteric favourites such as the sad tale of a lonely man on the moon. It is about a woman’s last-minute dash to buy the perfect gift for her sister. There is still magic: like the children in The Lion, the Witch and the Wardrobe, she tips through a rack of dresses into a world of memories that give glimpses of her sister growing up and, crucially, trigger gift ideas.

At a time of peak 1990s nostalgia, the ad is set to Richard Ashcroft’s indie anthem Sonnet. The singer’s stock is riding high after he was confirmed as the support for Oasis’s reunion 2025 tour.

The Christmas trading period is the all-important time of year when many retailers, including John Lewis, rake in the lion’s share of their annual profits.

But while the department store’s ads have become a national moment, marking the beginning of the festive shopping binge, there has always been a suspicion that they might not deliver a big sales payback. That concern became more acute after John Lewis suffered three years of losses. While it returned to an annual profit in March, it did not pay staff an annual bonus for the third time in four years.

“Times are tough on the high street,” said the retail expert Catherine Shuttleworth. “Consumer confidence is pretty low post-budget and business confidence is even lower. Retailers need a good Christmas because they are about to walk into a load of headwinds as a result of the budget.”

Retailers, which are big employers, will be hit hard by the chancellor’s decision to hike employer national insurance contributions. Tesco, for example, is thought to facing a £1bn increase in its national insurance bill over the course of this parliament.

This all means the battle for the pound in your pocket is fiercer than ever this Christmas because retailers know household budgets remain under pressure. To win custom, advertisers are expected to spend a record £10.5bn over the festive season. This is £760m more than last year, according to the Advertising Association and WARC data.

“This year, the Christmas ads have got to work really hard for the money,” said Shuttleworth, the chief executive of Savvy Marketing. “It’s been well-documented that since Covid, John Lewis has failed to get its mojo back. We’ve seen a change of personnel change at the top and this ad demonstrates their strategy of getting back to retailing.”

John Lewis’s job was to be a fantastic retailer, she said. “They need to get people to connect with the brand but, in connecting with the brand, the number one task is to get them to buy stuff from John Lewis. Not to just think ‘that’s nice’. It’s got to be more than a feeling.”

While some fans might feel short-changed without a lovable children’s character to moon over, Charlotte Lock, the customer director for John Lewis, said the ad acknowledged that department stores were the “beating heart of our brand”. “Our customers love the ritual of Christmas shopping there so we wanted to give the store a starring role in our ad for the first time,” she said.

Lock is confident the ad strikes the right note for the mood of the nation. “The John Lewis ad is more than an ad,” she says. “It’s a phenomenon. It’s something people use as a lightning rod to talk about things. We want to show up with something different and fresh every year.”

While previous John Lewis ads used cover versions of famous songs, in another twist it is actually Ashcroft singing this year. However, on Friday he will launch a competition for aspiring musicians to record their version of the song, which appeared on the Verve’s 1997 album Urban Hymns. The winner’s take will feature in a special Christmas Day airing of the advert on TV and be released as a charity single.

Ashcroft will launch the talent search on John Lewis’s TikTok page on Friday. The winner will also bag a £3,000 spending spree.