What Oercentage of Sales Are Successful at an Art Fair
The week earlier Fine art Dubai opened, Fine art Basel and UBS launched the second edition of the Global Fine art Market Report. This is widely regarded equally the most thorough and most accurate analysis of the fine art market, since information technology's written by Clare McAndrew, the elevation economist specialising in the field.
And then we can approach the numbers with some conviction. The headlines: after 2 years of failing sales, the global art marketplace turned a corner in 2022 and grew by 12 percent to reach an estimated $63.vii billion. The United states retained its position as the largest single market and China just about overtook the United Kingdom to take second identify (those iii markets make upwards over 80 per cent of total sales in 2017, up slightly on the year before).
[perfectpullquote align="left" bordertop="false" cite="" link="" color="" class="" size=""]The fine art market place turned a corner in 2022 and grew past 12 percent to reach an estimated $63.seven billion …[/perfectpullquote]
Dealers still account for the bulk of those sales, an estimated $33.seven billion that represents 53 per centum share of the full market, merely it'south the other pipeline – auctions – that seems to be growing faster. Dealer sales were up 4 percent year-on-year, auction sales jumped 27 percent.
As ever, though, the pic is skewed. "Much of the uplift in sales in the sale and dealer sectors was at the top end of the marketplace," says the written report. Abroad from the premium toll segment, overall market place performance was mixed. And the total number of sales didn't grow as fast equally values, an increment of 8 per centum in numbers of transactions against that 12 percent gain in total sales.
So are prices for private sales rising? Non exactly; remember the $450 million paid for Leonardo's Salvator Mundi? That was more four times the toll of any other painting ever sold at auction. Or Jean-Michel'south Basquiat (Untitled, 1982), which sold for $110 one thousand thousand? Or the ready of Twelve Landscape Screens by Qi Baishi (above), which sold for $141 1000000 – both the highest price ever paid for a work of Chinese fine art at auction and the highest price achieved at sale for a single lot in China?
The total value of works auctioned for over $ten one thousand thousand more than than doubled in 2022 – upwardly by 125 percentage – and those record-breaking auction prices for big names have obviously distorted the pic. By contrast, auction sales of works that fabricated $1m or less are failing. So in that location's no evidence that entry-level or mid-career artists are getting richer quicker (or at all).
[perfectpullquote marshal="left" bordertop="imitation" cite="" link="" color="" class="" size=""]Dealers with sales below $500,000 saw an average pass up of four per centum in their revenues …[/perfectpullquote]
Dealers aren't too unhappy, though. 59 percent of respondents to the annual dealer survey conducted for this written report by McAndrew's consultancy Arts Economics reported positive year-on-year growth, xiii per centum said their sales were about the aforementioned, and 28 pct noted a decline in sales. Once again, it's the big boys who are benefitting: those with revenues above $50 1000000 had the meaning increases in sales – up by 10 percentage. At the other end of the scale, dealers with sales below $500,000 saw an boilerplate reject of 4 percent in their revenues. Perhaps that's reflected in the ratio of gallery openings to closures, which was 0.nine:1 in 2022 – in other words, at that place were more galleries closing down than opening. (Back in 2007, the ratio was over five:1 – five times as many galleries opened than closed.)
Online sales go along to grow, albeit from a small-scale base. The online art marketplace reached a new high of $5.iv billion in 2017, upwards 10 percent on the year before and now making upward 8 percent of the total value of art sales. As widely reported, online is bringing in new buyers – dealers reported that 45 pct of their online buyers were new to their businesses in 2017, sale houses said 40 per centum of those buying online were new buyers.
And so to art fairs, the topic of the moment given the proximity (and record-breaking participation) of Fine art Dubai. Fairs go along to be a central office of the global fine art market, the source of sales estimated to reach $xv.5 billion in 2017. That's upwards past a decent 17 percent on 2016. Dealers reported that they made just nether half of their sales at art fairs in 2017.
[perfectpullquote marshal="right" bordertop="faux" cite="" link="" color="" class="" size=""]In 2017, there were over 260 major fairs, 50 of them existence added in the terminal 10 years …[/perfectpullquote]
On the other hand, it cost them more to attend those fairs – a full of $iv.6 billion was 15 percentage more than than the year before. Nevertheless, a gross margin of seventy percent doesn't seem a bad return; art fairs expect like a good investment for galleries.
In 2017, at that place were over 260 major fairs with an international chemical element, almost 50 of them being added in the last 10 years. You can empathise why. Initially art fairs immune dealers to work together to counter the growing power of the auction houses, recreating in some measure the same buzz as an auction sale nighttime while showing a broad range of inventory at various price levels for a express fourth dimension. They work for collectors too, providing an opportunity to see a variety of works in i identify and to network with dealers.
More recently, art fairs have been created self-consciously for a multifariousness of (more often than not good) reasons) – to boost a nascent local art market, to add lustre to new and ambitious location, to access a wider group of potential buyers and curators, to invite novice buyers to run into what's bachelor … the Dubai and Abu Dhabi fairs both fit the bill.
The report describes such newer fairs as "synthetic" rather than "organic", meaning that they have been launched or promoted past civic leaders or development corporations with the master aim of stimulating economic benefits (the "organic" model implies that the off-white has been developed from existing cultural communities and is often run solely or partially past dealers "or other agents with a deep understanding of art"). Some dealers thought that the established fairs have more impact in mature markets, merely clearer rated the importance of "synthetic" fairs like Fine art Dubai in the newer emerging markets.
[perfectpullquote align="left" bordertop="simulated" cite="" link="" color="" class="" size=""]There appears to be no direct link between footfall and the sales made at fairs …[/perfectpullquote]
Claire McAndrew's team didn't try to count full company numbers across the 260+ fairs, but did guess a million visitors for 20 of the largest and another meg for twenty key regional fairs (that 2nd group includes Art Dubai, cited at 28,000 visitors last yr, and Abu Dhabi Art at a commendably precise 21,489). Equally the report puts information technology, "Major art fairs attract huge volumes of foot traffic". On the other hand, "there appears to be no direct link between these numbers and the sales fabricated at fairs" – so "making an of import economic contribution to the cities that host them" is at least equally important raison d'être for some fairs. It's self-evident that a very small proportion of visitors actually purchase anything at art fairs – indeed, a very pocket-size proportion have the means and/or the inclination to learn art.
That may be a misapprehension, in fact; the written report says that 40 percent of the prices posted for works on sale at art fairs were below the $5,000 marking. To be off-white, for many good reasons dealers tend not to publicise the prices for upper-end art.
Clare McAndrew's concludes that art fairs are essentially A Skilful Affair. Escalating costs conspicuously remain an issue for many dealers – and it's not just the directly costs of participation; the opportunity cost of being away from the gallery for a week or more has to exist taken into account. So peradventure dealers will become more picky about which fine art fairs they patronise.
But most dealers surveyed (89 percent) felt that sales at fine art fairs would be stable or increase over the next five years. At the very to the lowest degree the fine art fairs can work as a marketing tool: "Some dealers were less concerned virtually the breakeven indicate at fairs, viewing them increasingly as an exhibition platform to showcase new work, introduce artists and meet new collectors, while then 'letting the sales happen during the rest of the year'".
Only a minor number of dealers predicted that due east-commerce could somewhen displace some art off-white sales, with platforms such equally Artsy and 1stDibs presenting 'virtual' fairs accessible 24/7 from any location. The Global Fine art Market Report suggests in that location is piffling evidence of this happening in exercise: "successful dealers consistently noted that online transactions and emails were sufficient for occasional transactions, simply often not enough to sustain a close personal human relationship, which was regarded as key in the evolution of longer-term buyers.
[perfectpullquote align="right" bordertop="imitation" cite="" link="" colour="" form="" size=""]Fairs, at the very to the lowest degree, offer five minutes face time with important buyers …[/perfectpullquote]
Elsewhere the Report does notes the evolution of hybrid gallery operations, typically collaborative exhibition spaces like San Francisco's Minnesota Street Projection or the upcoming Cromwell Place in London, which provide exhibition, storage and office infinite at relatively affordable rents for a grouping of galleries. The tenants (and buyers) get some of the benefits of a multi-vendor art fair with the stability and year-round access to a concrete gallery location. It's entirely believable that online exhibitions will provide the front end end to this kind of operation, with online auctions and e-commerce supplying an alternative sales medium.
Attracting buyers' attending, getting them physically in front of the art, and making a man connection is nevertheless key to success for most galleries, and it's probably the reason why many get to fine art fairs. As one gallerist put it: "Our biggest challenge this year, as it ever is, is getting people'due south attending … Fairs, at the very least, offer five minutes face time with of import buyers."
The Art Basel and UBS Global Art Market Report can be downloaded without charge here.
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Source: https://magpie.ae/63-7bn-in-art-sales-last-year-where-do-art-fairs-fits-in/
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