PROBLEM Every year, Cartier festoons its Fifth Avenue building with an iconic gift box and ribbon decoration. But last fall, its building was festooned with scaffolding instead.

SOLUTION The luxury retailer turned its sidewalk construction bridge into a “magical tunnel” of lights and greenery, bringing Christmas right down to the storefront.

New York ordinances require building owners to inspect their façades every three to five years for loose grout and stone and other possible defects. So in the spring of 2007, Cartier complied with the code, and scaffolding climbed up the building at Fifth Avenue and 52nd Street for workers and inspectors. The luxury retailer was given every assurance that the scaffolding would come down by October 1, plenty of time for the ribbons, LED lights and custom 15-foot boxes that annually add Cartier’s magic to the Fifth Avenue light and color Christmas show.

But by September 1, the completion date was looking shaky and Cartier realized it had better develop a Plan B or have no plan at all. Janette Wright Greenberg, Cartier’s assistant vp of visual merchandising, turned to its annual Christmas provider, Holiday Image (Long Island City, N.Y.), for a resolution. And the resolution might have ended up being an improvement on the original.

“We knew we couldn’t fully access the side of the building the way we were accustomed to,” says Holiday Image president and ceo Matthew Schwam, “so we decided to focus on the street level.” Using the existing sidewalk bridge so familiar to Manhattan pedestrians, Holiday Image created what it calls a “magical fantasy tunnel.” It created a new architectural ceiling for the bridge, covered it with garlands and lights and suspended it from the existing ceiling with beam clamps.

The pipes of the scaffolding were covered in garlands and 155,000 miniature white lights were inserted throughout the greenery. Speakers were also hidden within, adding music to the Cartier show for the first time.

To replicate the time-honored display on the side of the building, artwork re-creating the iconic ribbon-and-bow design was printed on mesh and strobe lights were inserted behind the scaffolding. Holiday Image secured the rights to build two sheds on a 10th floor terrace of the building across Fifth Avenue. Twenty-five projectors inside one of the sheds shined intense incandescent light along the shape of the ribbon. Three moving light fixtures inside the other shed projected “Happy Holidays” in 30 languages on the scrim. Colored bulbs and gels were tied into the Pantone colors of the Cartier box on the mesh.

So the first week of November 2007, Cartier’s magical tunnel debuted on Fifth Avenue, with hidden speakers playing “Carol of the Bells.” “The impact was enormous,” says Schwam. “There was this intimate environment in the middle of Fifth Avenue, with music and lights.” There was also a significant increase of foot traffic into the store, as people were drawn by the multisensory escape. “We were fully expecting to have to endure a negative effect for one holiday season,” Wright Greenberg says. “We never expected a positive to come out of all this.”

As Cartier approaches the 2008 holiday season, the scaffolding is down and the retailer is faced with a new challenge: how to replicate the surprise of a year ago, when it turned lemons into lemonade.