One great source of information about how the top-level art market works is Skate’s Art Market Research. Established in 2004, the organization provides unbiased research to support art investment decisions. Skate’s goal is to develop information tools and services that can help shift the balance of power in the art investment world from intermediaries (such as dealers and auction houses) to art collectors, art investors and artists. Earlier this year, Skate’s published a two-part Annual Art Investment Report for 2012. Part 1 discussed the world’s top 5,000 most valuable artworks based on public auction prices. Part 2 addressed trends in the global “art industry,” which includes auction houses, dealerships, e-commerce platforms, art investment funds, art financial services, and publicly traded art industry companies.
Part 1: Top 5,000 Artworks
To understand trends in the premium segment of the art market, Skate’s evaluates year-to-year changes in the 5,000 most expensive art works that sell at auction worldwide. In December 2012, these top 5,000 artworks were worth $33.3 billion, up 9% from 2011.
The study also showed that fewer people are buying more expensive art and are focusing on established names.
According to the report, “While 2012 showed that buyers have devoted more substantial funds to art purchases, it also revealed that they have become more selective in terms of their choices. The overall number of top-value works selling has decreased, and buyers have been selecting artworks from a far smaller number of artists than they did in 2011. A clear illustration of this can be seen in the number of new artists appearing in the ranking; in 2012.” In 2012, only 38 new artists were represented among the top 5,000 artworks, compared to 81 in 2011.
Download the full report here:
Part 2: State of the Global Art Industry
The report points out that “Comtemporary art buyers are not only carefully selective when it comes to their art purchases, but they also requires high-level services to help them manage the works they acquire and abundant information to help them refine their ideas regarding art collecting.”
The report describes trends in auctions, events, and online sales, noting that the art trade is undergoing some major changes.
Overall, “Skate’s sees bright prospects for the art industry as entrepreneurs and innovators continue to tweak old models and invest in new business models to play on the increasing attractiveness of global arts to global consumers.”
Overall, “Skate’s sees bright prospects for the art industry as entrepreneurs and innovators continue to tweak old models and invest in new business models to play on the increasing attractiveness of global arts to global consumers.”
Skate’s observes that the quest for new art collectors is making it difficult for many dealers to operate as local enterprises. Their analysts predict that “Those galleries that are undercapitalized, poor on risk management, and unable to grow their trade to meet the tastes of international buyers will eventually face a slow death. The successful gallery now must possess recurring access to third-party financing, the ability to operate internationally by attending multiple fairs and having points of presence in a few geographies, and a management team with a strong combination of artistic and commercial skills.”
But the report also acknowledges an influx of new faces to the art trade, including some who want to push “consumer-grade” art and serve as specialty retailers: “These developments may forever change the centuries-old tradition of art dealing based on selling to a privileged class.”
Download the full report here:
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