What major transformations will we see in the art market in the years to come?
As a result of new regulations and the accelerated adaptation of the art market to a new remote environment, transparency and digitalisation are the two major forces of change to come. These two trends influence each other. The impossibility of physical contact has pushed galleries to post prices online, a new practice that was reserved for secondary market players in the past. This increase in transparency is a positive signal, making it possible to assess the performance of the primary market and giving collectors confidence.
Digitalisation has already made itself felt, with a significant increase in online sales in 2020, which, according to Artprice.com, The Art Newspaper Podcast and Fine Art Group, will account for 25% of overall sales for the year, twice the figure for 2019. This proportion is likely to increase exponentially, driven by the new generation of collectors and technological advances. The digitalisation of the market also extends to new art forms such as non-fungible tokens, or NFTs, which make use of cryptocurrencies and social networks to bypass traditional intermediaries. It is still difficult to define them as works of art, and too early to foresee how long they will endure. However, there is no indication that they will not withstand the test of time and eventually become a full-fledged artistic movement. Do they represent the last bastion of “low-art”, or will they become a new form of pop-art with Warholian aesthetics? The Impressionists were reviled in their early days. This did not prevent them from becoming one of the most transcendent movements in the history of art.
Who will be the players of tomorrow?
The shift to the new generation of collectors has already begun, as evidenced by the fact that millennials under the age of 40 made 25% of all purchases at Sotheby’s in 2020. According to the Fine Art Group, 30% of millennials made purchases of more than a million dollars last year, compared to only 17% among baby boomers. These new collectors have a very pronounced taste for “ultra contemporary” art. This generational transition can also be seen in the emerging artists and current trends, with a kind of new populism influenced by socio-cultural and environmental issues. This can be seen in the meteoric rise of prices for works by women and African-American artists, such as Amoako Boafo, Jamie Holmes and Christina Quarles, who are among those who have recently set sales records. In fact, sales of works by artists under the age of 40 rose by more than 50% in 2020 at Christie's, Sotheby's and Phillips.
There is also a growing schism between different categories of collectors.
- The new generation focuses more on social impact, both through the artists’ messages and their ability to question the world today.
- The very wealthy from the emerging countries, on the other hand, favour buzz and speculation. This was seen with the version of Banksy’s “Girl with balloon” which sold in March for over a million dollars, with the majority of bidders coming from Asia.
- Major collectors, on the other hand, are moving towards sustainability, with fewer record transactions and longer retention periods for fine works. The recent sale of a Van Gogh for EUR 11.3 million shows a healthy stability in blue chip sales and a return to fundamentals. This is an indication that the market is catching its breath and is gradually emerging from a period of speculation.
Is a return to local markets conceivable?
In fact, we are seeing a return to the local level and a certain regionalisation of the market that is likely to last for years to come. This is due to an increased sense of nationalism that has developed again in recent months. Unlike 2009, when it would have been bad form to publicise a major new acquisition, the 2020 crisis has not had the same impact. There is a strong desire to support the socio-cultural sector, which in turn is leading to a renewed interest in local emerging artists. As a result, a significant reduction of around 30% in the number of art fairs is expected. Although exacerbated by recent events, this phenomenon of “art fairtigue” has steadily increased in recent years.
This somewhat forced return to the local is undeniably accompanied by a need to rethink access to art. This growing consolidation of international fairs, combined with a regionalisation of the market, will benefit art advisors. With collectors less on the go, the role of these intermediaries will take on considerable importance in order to maintain privileged access to the market. Their networks will be their greatest asset in a digitalised market.