Online Sales Strategy for Galleries Thomas Galbraith Managing Director, Auctions Paddle8
Overview • Development of the online art market • How online companies have changed the market • Which companies to follow • How to use them • Case Studies
Development • Successes and Failures – Sotheby’s and Amazon • less than 1 year – Sotheby’s and Ebay • Ended in 2003 – Amazon Art • A more recent endeavor which stalled before it started – Artnet • One of the few success stories able to last through the 1999 crash – Paddle8 • In the space of 3 years the company has become the leader in online auctions – Christie’s • Though from the old guard, Christie’s has made it a mission to reinvent itself
Changing the art market • Information everywhere – Sales/prices are significantly more transparent now than ever before – Available to anyone, new buyers may very well have done extensive research before walking in the gallery door – Examples include, artnet, artprice, artron, artinfo databases and Tutela, ArtTactic, Arts Economics analysis firms along with many more • Access to all – Global communities can be procured by all: artists, galleries, auction houses – Traditional barriers still exist, though are lower than ever: people can buy works on the primary or secondary market from their laptop – Twitter and more importantly Instagram are allowing artists access to massive online communities and in some cases direct sales
Changing the art market • Economics – I save, you save – Across the art market, the fundamental economics are starting to shift – The cost efficiencies of being online: lower operational costs, lower rent, more efficient transactional processes, smaller teams, these savings are being passed on to clients – Buyers are much more comfortable spending large sums online – Paddle8 passes on massive savings to it’s consignor and buyers. Christie’s has retained it’s antiquated cost structure even online. • Interface and usability – that looks pretty – Websites have improved beyond all recognition from the failed 1999/2003 Sotheby’s attempts. – Limitations that existed then, image quality, lack of information, have been solved for now – Websites selling art are engaging, use high resolution imagery, incorporate much more information, condition reports etc and client/seller interaction – Art.sy showcases art fairs online in a beautiful fashion, much more successfully than the VIP Online Art Fair ever did. Paddle8 is lauded for it’s beautiful online auctions, complete with high resolution images, condition reports, provenance and supporting documentation. Artbinder does an incredible job of aiding galleries with their inventory management.
Companies to follow • Information: – Databases • Artnet – the most comprehensive, also the most expensive • Artprice – less detailed, also less expensive • Artron – fantastic resource for the Chinese art market • Artinfo – greatly improved and free – Market Analysis • Tutela Capital – often regarded as the leader in the space, highly praised methodologies • ArtTactic – produces an important annual report with Hiscox • Arts Economics – produces one of the most widely read annual art market reports in the world for TEFAF. • Artnet – uses a somewhat dated methodology, though still applicable in some circumstances
Companies to follow • Access: – Social Media • Twitter/Facebook – these can be great to build and inform a community very quickly • Instagram – repeatedly referenced as one of the most game changing apps in the art market today, All Visual! • Artron – fantastic resource for the Chinese art market • Artinfo – greatly improved and free – Selling • Paddle8/artnet/auctionata/HeiHey – online auctions • Art.sy/artnet – online listing service • Exhibition A/Artshare – online galleries
Artnet • Artnet changed the way the art world works • Access to sales data and lot information at our finger tips caused a revolution • Aggregating sales data increased transparency for everyone, galleries, auction houses, buyers and sellers. • The implications are on going and arguably make for a much more efficient market • Other ventures have had mixed success. • Online auctions have been a drain on the company’s finances • Gallery Network, once a monopoly, is now faced with competitors • The Magazine was unprofitable, though in a bit of good news, the revamped News division seems to be a success and contributing to the company revenue
Paddle8 • Revolutionized Charity Auctions • Doing the same thing with for profit auctions • Elegant and engaging website • Very easy transactional process • Introduced significant cost efficiencies to sellers and buyers, generated by passing on savings resulting from reduced transaction costs • Catering to modern collectors with a wide range of inventory – Canvas, Prints, Editions, Design Objects and soon watches, jewelry and more • A broad global buying community • Auctions hosted across the world, New York, Los Angeles, London, Berlin, Paris, Hong Kong, Beijing, Beirut. • Rapid success – 3 years old and already out performing competitors. • 1H2013 = $18M sold, 400% increase over 2013. 60% of net revenues were generated by the For Profit side of the company.
Artsy • Initially known for pursuing an art gnome project – intended to link artists and artworks through a massive visual and thematic linking project. Often referred to as the Spotify of the art world. • Art fairs and gallery listings have proven to be the future for artsy. They have cornered a niche in providing galleries and art fairs with advance online marketing ahead of major fairs or exhibitions. • Leads from potential buyers are passed on to galleries for possible sales. • Art fairs are highlighted to artsy’s community • Little is known of their financials, though they do have the backing of a number of interesting individuals and recently raised a large sum of funding for their mission
Instagram • A massive global community recently acquired by facebook. • The visual nature of the app lends itself extremely well to use by the art market. • Collectors, Galleries, Artists, Auction Houses all use the platform • More and more sales are being conducted as a result of marketing on instagram. • Numerous artists are making sales straight out of their studios, some have become very well known without any gallery representation. • Some galleries have been known to show instagrams in private viewing rooms, others have embraced their artists audiences and encourage them to work together with the gallery’s online presence. • Instagram perhaps represents the biggest change in the art market over the past 5 years.
How to use them? • Objectives? – In order to understand which online companies a gallery should use, it is important to consider which align best with internal objectives. – Some online companies may appear to be natural partners, while in fact they are more likely to be competitors, and some may appear to be competitors, which in fact are not. The implications of such decisions can have serious effects on ones business. – Create a profile of your company and work on matching that with the profiles of other online companies to see how they align. • What price points does your gallery sell at? • Where are the majority of your buyers/sellers? • How and when are sales most likely? Art fairs/auction/winter/summer? • What kind of budget can be allocated to online ventures?
Case Study #1 • Anonymous Gallery - large budget – Locations in New York and Los Angeles and London – Has a website, routinely updated – Participates in many art fairs around the world – Clients are international, though most are US based – Listed on artsy.net – Consigns and sells regularly to Paddle8 – Has a twitter and instagram account – Price points vary from low $1,000 - $1M +
Case Study #2 • Anonymous Gallery – Medium budget – Location in New York – Has a website with some information updated every few months – Participates in a few art fairs in the US. – Clients are mostly US based – Consigns and sells regularly to Paddle8 – Has a twitter and instagram account – Price points vary from low $1,000 - $500,000+
Case Study #3 • Anonymous Gallery – Low budget – Location in Pennsylvania – Has a website which is fairly simple – Participates in no fairs – Clients are almost all in East Coast US – Consigns and sells almost exclusively through Paddle8 – Price points vary from low $1,000 - $100,000+
Case Study #4 • Rodi Gallery – No budget – Location in Anywhere – Has a website which is very simple – Participates in no fairs – Clients are where ever the Gallery is – Consigns and sells almost exclusively in a truck – Price points vary from low $1,000 - $25,000+ – Uses Twitter and Instagram extensively
Rodi Gallery
Online Strategy • Each business has different objectives and ambitions. • Using the right tools and partners can help realize those goals. • Understanding which partners and tools to use can take some research, the payoff can be well worth it.
Recommend
More recommend
