The variety store group will axe prices by an extra 10 per cent, to drive footfall and sales in the wake of a£20 million ad blitz.
After disappointment last year, Woolworths is determined to make Christmas work. It is understood that private equity firms are circling and will pounce early next year if Woolworths underperforms.
Woolies started its Christmas TV push on Wednesday, when it ran three ads in the main Coronation Street break. The retailer is also running radio and press ads.
Marketing director Stephen Robertson said: 'We started with a bang by dominating the central Corrie slot. We've created the most integrated campaign in Woolworths' history.'
Woolworths faces tough competition, despite advertising gifts at less than£10 and 25 per cent off toys. Asda has cut toy prices by 50 per cent as part of a two-week campaign.
In January, Woolworth's revealed flat Christmas like-for-likes at its main chain. Venture capitalist Apax was keen to buy the retailer, but a 58p-a-share deal collapsed in acrimony.
Over the past three months, Woolworths' shares have fallen more than 11 per cent. One source with private equity connections said share price weakness and poor trading could prompt a Woolworths bid in the New Year.