A partnership between 270-year-old international auction house and modern Internet shopping giant hopes to make art more accessible.
Collectors will soon be able to browse eBay for premium works of fine art, alongside clothing, make-up, spare car parts and kitchen appliances. Art Radar investigates whether such a move can truly bring art to the masses.
Sotheby’s and eBay announced on 14 July 2014 (PDF download) that they will create an innovative online platform to allow viewers to bid on and buy art. Bruno Vinciguerra, Sotheby’s Chief Operating Officer, said that Sotheby’s hopes to “truly make art more accessible to exponentially more collectors.”
Starting this fall, the project will begin with live streaming of auctions from Sotheby’s New York on eBay’s website, allowing real-time bidding from anywhere in the world. There will be eighteen categories to start with, including jewellery, watches, prints, wine, photographs and twentieth century design.
A timely second attempt
The deal marks the second time Sotheby’s has partnered with the internet shopping giant. A premature venture in 2002 failed after only a year, but The New York Times reports that “officials say the market has matured in recent years, making the moment right for a new collaboration.” Through the partnership, Sotheby’s aims to
reach beyond its traditional customers to an enormous affluent global audience for whom online buying has become second nature.
Bringing art to the masses?
In theory, the partnership expands Sotheby’s exclusive pool of customers from around 100,000 to 145,000,000 – the approximate number of users on eBay. But is Sotheby’s really going populist? Will the partnership democratise the art market?
According to Artnet, more than 3,500 eBay auctions close each day with a price over USD5,000. This is the buyer segment targeted by Sotheby’s middle market collection: in 2013, more than half of Sotheby’s lots were sold within the USD5,000-100,000 range.
Compared to the USD100,000 upper end of Sotheby’s middle market range, it seems that other online art sales platforms make a better claim to art accessibility by offering items at a lower range. According to Bizjournals, Artspace, an art e-commerce site launched in March 2011, typically sells works for under USD10,000. Manhattan-based online auction house Paddle8 reports a similar price point.
Although there are concerns about the future of such smaller platforms in light of the Sotheby’s-eBay partnership, Crainsnewyork.com reported last year that:
The typical price point for the art sold on Paddle 8 is about USD10,000, so it doesn’t directly take on powerhouses like New York’s Sotheby’s, London’s Christie’s and Dallas-based Heritage Auctions.
Affordable art and the online art market
Global art sales reached USD1.57 billion in 2013, out of USD66 billion worldwide, according to The New York Times in May this year. Banksy’s former dealer, Steve Lazarides, accounts for the measly 2.4 percent:
It’s difficult to sell one-off things online. You can’t replicate the X-factor of a painting on a website, and if you’re going to drop 50 grand on a work of art, you want to develop a relationship with the person selling it. You don’t want to just get out your credit card.
Although successful virtual marketing is done using high-resolution jpegs and Instagram, the majority of pure online transactions are priced below USD15,000. Buyers of higher-value art tend to view potential purchases in person, bidding either at auction or through a trusted sales agent.
But the smaller-priced items present a bigger opportunity. Anders Petterson, Founder and Managing Director of ArtTactic Ltd., a London-based art-market research and advisory company, told Crainsnewyork.com that:
The high end of the market is not a volume business and is not where the growth can or will happen.
Instead, lower-priced items comprise “a rapidly expanding sector, growing at a rate of 19 percent per year,” according to The New York Times, who also said that:
as blue-chip contemporary works become more expensive, affordable art presents itself as an opportunity for e-commerce […] Companies [such as Artsy, Paddle8, etc.] are competing for a new generation of younger professional buyers who are comfortable about shopping online; who’d like to buy art, preferably on-trend contemporary works; but who feel intimidated by established auction houses and galleries, and the cost of the art they sell.
According to The Indian Express, Sotheby’s says that online sales could grow at a rate of at least 25 percent per year after the 5 percent of sales in 2013. Online bidders competed for 17 percent of total lots offered in 2013, while the number of lots purchased online increased 36 percent from 2012. The icing on the cake was John James Aubudon’s book The Birds of America (1827-1838), which fetched a record-breaking online purchase of USD3.5 million in a live auction in April.
But the Sotheby’s-eBay partnership is not without challenges: Sotheby’s long-time rival Christie’s has ventured into similar waters earlier. According to The New York Times, Christie’s held 49 online-only auctions of lower-value items last year, raising USD20.8 million. While this accounted for only 0.3 percent of the company’s record sales, 45 percent of the buyers were new.
Furthermore, according to The Guardian, Christie’s is scheduled to launch a USD50 million redesigned website in October guided by experts at high-end online retailers like Gilt.
In contrast, some analysts say that a partnership with eBay risks tarnishing Sotheby’s 270-year-old image of prestige and class. The New York Times reports:
In October eBay hired RJ Pittman, a former head of Apple’s e-commerce efforts, to oversee a redesign of its website […] Meanwhile, Sotheby’s has dispatched its own team to make sure the eBay display doesn’t look cheap.
The Sotheby’s-eBay partnership will look to position itself carefully to capture the growing lower-value art market whilst conserving its high-end customer base. As Josh Baer, an art adviser hired by eBay to help shape its art initiatives, told The New York Times, the new venture will not “take away from selling a Jeff Koons sculpture for USD58 million.”
- A new wave of energy in the art market – Christie’s Hong Kong Spring Auctions 2014 – May 2014 – at Christie’s Hong Kong “The Era of Asia, The Art of Asia” spring sales no records were broken, but sales proved that regional collectors have growing appetite for art collecting
- Unexpected results reveal hidden trends at Sotheby’s Hong Kong 2014? – April 2014 – Sotheby’s spring sales of Contemporary Asian Art presented unexpected passes and some record sales, uncovering new trends among Chinese collectors right now
- Christie’s opens first Asia-based gallery in Hong Kong – March 2014 – Christie’s opens its first Asian gallery in Hong Kong, The James Christie Room, targeting the region’s rising art market and affluent collectors
- How the internet is changing art business: 6 exciting start-ups – February 2014 – Art Radar surveys the growing global online art industry with a look at 6 promising online start-ups
- “Modest by international standards”: Sotheby’s inaugural China mainland sale receives measured reactions – December 2013 – Sotheby’s first auction in mainland China saw healthy overall bidding, selling 82 percent of lots and setting a new record for Chinese grandmaster Zao Wou-ki
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