I received my invitation recently to attend the American Express Luxury Summit, the annual gathering of all the well-meaning folks who are, or who want to be, doing business in the “luxury” space. I was first introduced to this world as an attendee at this summit at the Deer Valley Lodge in Park City Utah in 2011.

At the time, I watched a large group of marketing folks (including myself) who had a foothold in the luxury space, and were looking to expand, jockeying for a connection to the star presenters and panelists who made up the agenda for The Summit.

Most memorable was the group from McKinsey & Company, the evil empire of market research, who toil day and night to develop, and then interpret, research statistics. They then sell their “insights” to executives who find comfort and/or cover for their business planning and marketing strategies.

The wizards of McK rolled out their MBA credentials and proceeded to rehash the 10-year-old wisdom of the emergence of the BRIC markets and the importance of marketing to BRIC countries. The term “BRIC” was coined back in 2001 by another bastion of research, Goldman Sachs. The term has been kicking around ever since, describing the emergence of Brazil, Russia, India, and China as the places with the most new money, new millionaires, and as a result, new luxury consumers who were supposed to be chomping at the bit to spend their new piles of rubles, reals, renminbis, and rupees on the Summit delegates’ products and services.

The BRIC countries were, according to McKinsey, the “lands of opportunity.”  All the leading luxury brands, especially in the hospitality industry, were heavily investing there, and so should all of us, sitting in our resort-ballroom chairs, staring wide-eyed and mesmerized by the biggest brains in the business.

Bull.

I remember my initial hesitancy with accepting this concept. While the numbers told a compelling story, when you considered the reality of the uncertainty and turmoil in those places, the “opportunity” was surely severely limited to those organizations with huge infrastructure and worldwide brand recognition to play in those strange and unknown sandboxes.

In fact, one presenter, who followed the McKinsey presentation, held significant credentials in the hotel industry, and was at least twice as old as the McKinsey children, warned us all that the numbers were one thing, but the reality of doing business in those places was another.

As Mark Twain said: “There are three kinds of lies:  lies, damned lies, and statistics.”

Those in the room who made a business growth decision based on the McKinsey presentation, especially those with niche luxury brands, may be regretting their choice.

Here’s what’s happening today in the BRIC land of opportunity. A story from just last week in The Economic Times detailed the problems:

 The Bric nations have their challenges, some unique and some common. Inflation, corruption, policy, climate change and the inequality between the rich and the poor is common. Infrastructure is strength in China but a weakness in Brazil and India. India enjoys a freer media than others, but it lags in urbanisation, something that aids productivity as rural folk move from less productive agriculture jobs to more productive industry and service jobs. Bric needs to do more in education if future productivity needs to improve. India has the best demographic break as it will add more than 100 million to the workforce. The Bric story can disintegrate if these countries do not manage their politics and policy to be attractive.

The New York Times draws attention to the Fragile Five to comment on the uncertainty of emerging markets in general:

The new name, as coined by a little-known research analyst at Morgan Stanley last summer, identifies Turkey, Brazil, India, South Africa and Indonesia as economies that have become too dependent on skittish foreign investment to finance their growth ambitions.

The term has caught on in large degree because it highlights the strains that occur when countries place too much emphasis on stoking fast rates of economic growth. The new catchphrase also raises pressing questions about not just the BRICs but about emerging markets in general.

The writers on nasdaq.com were issuing warnings about it as early as last spring:

The bottom line is this; until those black swans hiding in emerging markets disappear and more transparency is delivered, it’s time to be picky…  search for new frontiers, focus on individual sectors within traditional emerging markets and be on standby with your hand on the sell trigger because emerging market investing has just turned from a walk in the park to a walk through a mine field.

Smaller and mid-sized luxury brands, particularly niche brands, can’t afford to gamble their marketing budgets that way. It’s okay to take risks – it’s not okay to hurl your brand off a bridge and hope there’s a miraculous raft floating below to catch it.