Luxury expert Daniel Langer looks at the shift happening in the luxury world that is threatening some brands, and offers insights on how to survive it
Recently, some luxury brands have been facing significant headwinds: slowing sales as aspirational luxury clients in China, Europe, and the US in particular recalibrate their spending habits in light of high interest rates, economic uncertainty, and—especially in China—the housing market crisis.
However, not all brands are affected equally. The brands that are best at creating desirability are growing. However, others are declining 5 per cent, 10 per cent or even more. And within luxury, a seismic shift happening. Whether it is within luxury hospitality, fashion, automobiles, or haute cuisine, is experiencing a massive transformation as economic fluctuations, evolving consumer expectations, and an unprecedented global upheaval leave them facing a stark choice: evolve beyond mere opulence or risk fading into oblivion.
You might also like: How a solid story and unshakeable core values can carry luxury brands through its transitions
The crisis of authenticity in a world of abundance
Today’s luxury clients do not lack options. In a world where a premium tag can be easily purchased, what’s truly rare is authenticity. Ad brands that merely lean on heritage, legacy or price points are finding themselves at odds with a discerning clientele seeking something more profound. Especially Gen Z consumers who value experiences much more than heritage or other factors.
To be sure, what many brands underestimate is that authenticity is binary. You are either authentic or you are not; and most brands aren’t. In times of uncertainty, this will haunt them.
Navigating the ‘beyond fine’ dilemma
Brands, now more than ever, need to re-evaluate their ethos. It’s not just about the tangibles anymore. The intangibles—emotions, stories, experiences—have taken center stage.
The quest isn’t just to offer products or services, but to curate memories, to craft brand-related narratives, and to foster connections. If a client rates your brand as “fine”, then you are about to become irrelevant. In luxury, the exceptional is the only acceptable currency.