Doing a get-together on Hearth's Warming Eve with the Mane 6, Spike, Starlight Glimmer, and Sunset Shimmer, Eric Reed made an offhand comment about Santa Claus. It brought to his attention that Twilight, Starlight, Spike, and Sunset (and possibly Pinkie Pie) are the only Equestrians who knew who Santa is.

So, Eric told the rest of the Mane 6 about the legend of Santa Claus. But little did he know as he told his story that it gave a couple of ponies ideas...

It's not required to do so to enjoy this story, but if you want to learn how and why the human OC Eric Reed is in Equestria, check out A Giant Adventure to Equestria. Or When Dating a Sunset... to learn where Eric and Sunset became a couple, although the relationship only plays a very minor role in this story.