Virtual galleries open new markets for art
- 16 December 2014
- From the section Business
Every year in December, Miami Beach becomes the epicentre of the art world. Tens of thousands of people flock to Art Basel where sales of art reportedly top $3bn (£1.9bn).
In the hyper-party atmosphere billionaires rub shoulders with struggling artists and serious collectors vie with amateurs to spot a potential masterpiece. Thanks to the internet, art has never been more accessible and new markets are opening up around the world.
"China is a really exciting opportunity for us," says Carter Cleveland, the 28-year-old founder of Artsy, an online database featuring works by 25,000 artists and more than 2,000 galleries around the world.
Officially launched in 2012, Artsy has attracted $26m in funding and has some big name backers such as Paypal cofounder Peter Thiel. The site makes money by charging galleries a monthly subscription to list their art.
The company has an office in Hong Kong but has yet to establish a presence in mainland China. In an effort to make contacts and pave the way for expansion, Artsy hosted a celebrity bash where the star of the party was Chinese choreographer and artist Shen Wei.
"China is a lot more challenging because they have their own infrastructure and their own social media and their own search engines," says Cleveland. "So when you want to expand into mainland China it takes a much more thoughtful approach."
China's contemporary art market didn't exist much before 2000. It has now overtaken the US, according to Berlin-based Artnet, another online platform that specialises in art auctions. In fact, growth in China appears to be driving the global art industry, which is worth an estimated $66bn.
Underscoring the boom in sales, several Chinese galleries staged exhibitions at Art Basel in Miami Beach, including newcomer Beijing Commune. Director Lu Jingjing says the gallery is considering joining Artsy but is still weighing the benefits.
"Search engines are very well developed too so you have to measure whether it's worth the investment," she says.
Beijing Commune currently uses WeChat - a mobile messaging app that has 438 million users, mainly in China.
"It's not a selling tool like Artsy or Artnet. But you can make your own newsletter about your exhibitions and you know how many people have read it," says Lu Jingjing.
Hsinke Lee is head of exhibitions at Long March Space, another Chinese gallery at Art Basel. She thinks digital platforms are a "positive" development and predicts they will have a greater role in the Chinese art market.
She says many people already buy most things through Taobao, the Chinese equivalent of Amazon, and art is no different.
"I've noticed a lot of collectors purchase works without viewing them first in person. I myself have clients like that. Even when the work is worth close to a million dollars, they don't need to see it," she says.
But the international art market is largely unregulated and other experts warn that buying online poses hazards for the unwary.
"You're only as safe and secure as the ethics of the particular dealer you're dealing with," says Rhonda Long-Sharp, a former lawyer who now owns an eponymous gallery in Indianapolis. She was exhibiting at Scope, another art fair timed to coincide with Art Basel in Miami Beach. Ironically, she switched careers after buying a fake Picasso online.
"From that I learned a great deal about the art market and the art world," she says."When a collector looks online and says he wants a Warhol, he's going to find hundreds of galleries that purport to handle Warhol.
"But you don't know if they're a legitimate gallery, you don't know if the piece is authentic and you don't know if the condition is outstanding or if it's been restored so much that the value is really a smidgen of what it should be."
Nevertheless, she pays Artnet "a fair amount of money" for a gallery page. She says it is an important marketing tool for Long-Sharp Gallery and good for collectors who want to learn more about a piece.
"Online impacts fairs like this because if you see something here that you like you can go online and look at other works by the artist. People often come here with their cameras, snap a shot of the piece and snap a shot of the name tag. You'll hear from them maybe two months later."
Far from competing with physical fairs such as Art Basel, digital and social media have become an integral part of the event. In addition to 73,000 visitors, Art Basel Miami has 300,000 Facebook followers, 150,000 Twitter followers and 100,000 on Instagram.
Organisers also tapped into that online community to launch a crowdfunding campaign for non-profit art organisations that generally don't attract major investment but are seen as essential incubators for emerging talent.
Big businesses are also entering the digital art world. The Swiss bank UBS, a major sponsor of Art Basel, hopes to meet the surging demand for information with the launch of Planet Art, an app that aggregates news about contemporary art.
Peter Dillon, head of global art platforms at UBS, says it cuts through the clutter in a complicated market. "It expands access to the art world and the art market. For somebody who is new to it, this is a great way to get real-time information," he says.
"It's data led so it's objective. It's based on an algorithm that uses the facts in articles to index and organise them. It's applying a skill set that we have as a bank to the art world."
But although UBS has a massive corporate art collection, Dillon says the bank does not advise clients on buying art as an investment. A sentiment echoed by Art Basel director Marc Spiegler.
"The whole issue of art as an investment makes me somewhat queasy," he says. "A lot of people have tried to do art funds, almost all of them have failed. Historically the collections that appreciated the most are the ones that went against the market. There is always a speculative market, there's always a bubble - but it's small.
"Our fair is not about monetising mini-bubbles; our fair is about building a sustainable support base for the careers of artists and their galleries. I think people should buy work that they like."