By Vicky Sidler | Published 8 July 2025 at 12:00 GMT

Luxury isn’t what it used to be—and that might be a good thing.

According to a fresh Bain & Company report, personal luxury goods are slipping for the first time since the 2008 crash (Covid dip aside). Big brands are scrambling, Gen Z is questioning their price tags, and social media engagement has tanked by 40%.

But beneath all the drama is something worth paying attention to—especially if you're running a small business.

When even billion-euro brands are being forced to “get back to basics,” it’s a wake-up call for the rest of us.

TL;DR

Luxury brands are slipping, and Gen Z isn’t buying the hype. Here’s what small businesses can learn from their missteps:

• A vague message no longer cuts it—clarity wins

• Emotional connection and customer experience beat prestige

• Lean, focused strategies are outperforming bloated, scattered ones

If billion-euro brands are being told to simplify, so should you. Start with a clear one-liner using the 5-Minute Marketing Fix.

What’s Actually Happening in the Luxury Market?

Let’s break it down:

• Luxury sales are expected to shrink 2–5% in 2025.

• Gen Z is starting to question whether expensive equals better.

• Brand engagement is falling: fewer searches, fewer follows, fewer clicks.

• Physical retail (especially multi-brand stores) is under pressure.

And here’s the kicker: brands that used to get by on cachet alone are now being told to focus their message and stand for something clear.

Sound familiar? It should. That’s the core of StoryBrand.

People Buy What They Understand—Not What’s Expensive:

One of the Bain analysts put it this way: “At the heart of this shift lies a more fundamental question: who are we as a brand, and what do we stand for?”

For small businesses, this isn’t optional. If you’re not clear, people move on.

And now, the luxury world is learning the same thing the hard way: vague prestige doesn’t work anymore.

Here’s what small brands can do better:

• Be culturally relevant, not just flashy.

• Explain your value in plain language.

• Make your offers emotionally meaningful.

That’s messaging 101—and it’s more powerful than a billboard budget.

Experience Beats Prestige (and That’s Good News):

Luxury hospitality and gourmet experiences are still growing.

Why? Because they make people feel something.

The report notes strong demand for:

• Curated food experiences

• Boutique hotel stays

• “Slow travel” via yacht or cruise

Translation for small businesses: people want moments, not marketing fluff.

So, ditch the jargon. Sell the experience of working with you. How will your service make someone feel? What does life look like after they buy?

Answer those questions, and you're ahead of most big brands already.

Lean Strategy: Stay Focused, Stay Flexible:

Bain also pointed out a widening gap: some brands are thriving, others are stalling. The difference? Clear focus.

Top performers aren’t chasing every trend—they’re doubling down on what they do best.

This is textbook Lean Marketing:

• Cut the dead weight

• Find what works

• Do more of that, consistently

You don’t need a luxury-sized budget to do this. You just need a simple plan—and the discipline to follow it.

StoryBrand Isn’t Just for Small Players:

Even luxury giants are being told to revisit their value proposition. It’s no longer enough to “just be a name.”

They’re being asked to:

• Reconnect emotionally

• Get clear on who they’re for

• Offer value beyond the product

If that’s true for Gucci and Chanel, it’s doubly true for you.

That’s where the 5-Minute Marketing Fix comes in. It helps you create a one-liner that explains what you do, why it matters, and who it’s for—in plain English.

And in a world that’s tuning out the noise, clarity is the new luxury.

👉Download the 5-Minute Marketing Fix