Did you know? The online market remains enigmatic, but its future is guaranteed. Buying art online is exciting and with help of social media, especially Instagram, the interest keeps growing.
Active online buyers purchasing more and on higher prices. In 2018, the share of online art buyers paying an average price in excess of US$5,000 per fine art object increased to 25%, up from 21% in 2017. Confidence of buying online increases among people. Surveys show that 52% of those who bought online last year will buy more art in the upcoming year, 38% will buy the same this year as they did last year, 28% of those who have not bought art online in the past year, say they are ‘likely’ or ‘very likely’ to do so this year.
Established collectors continue to embrace online. Art buyers surveyed this year visit art and collectible sales websites frequently; half visit at least once a week, which was slightly lower than last year (52%), but up from 47% in 2016. Interestingly 38% of big spenders visit art and collectible sales websites several times a week (up from 31% in 2017), compared to 19% of small spenders and 18% of new buyers. This could indicate that existing collectors are increasingly using the online art market to search, discover, follow, and also buy art – it is becoming just another ‘channel’ for these active buyers.
Online art market broadens buyers’ interest in cross-collecting. Paintings and prints remain the preferred medium with online art buyers, but all collecting segments have increased in popularity. Almost three quarters (74%) of online art buyers bought more than one art object online in the last 12 months, and are expanding the range and type of artworks and collectibles that they buy. Photography collectors are increasingly active online. There was a particularly marked increase in those purchasing multiple photographs; 17% of photography buyers bought over six items in 2018, up from 6% in 2017.
There is a tendency for technical inventions among online platforms. Investment in deep learning and artificial intelligence is becoming ‘the latest weapon’ in the battle for new online buyers. Platforms are concerned about protecting the data from hackers but the general awareness and preparedness for GDPR is low. Despite its widespread applicability, 41% of galleries and 24% of online platforms surveyed were not aware of the new General Data Protection Regulation (GDPR). New GDPR came into force 25 May 2018 aimed to unify data standards and provide greater data protection for EU citizens.
Price transparency is key for new buyers. Although existing collectors are used to secrecy and a lack of transparency when it comes to pricing, this is an aspect which clearly doesn’t sit well with new buyers.
Third-party marketplaces gain popularity. Three-quarters of galleries used third-party marketplaces to sell art online in 2018 (up from 59% in 2017 and 41% in 2016). One in five (19%) are now using these marketplaces as an outlet for at least half of their online sales (up from 3% in 2017). Galleries claim that selling online helps broaden the international collector base. Almost three quarters (70%) of galleries this year sold their artworks online to international clients – up from 54% in 2017.
The UK has a special place in Global Art Market. The three dominant market hubs are the US, UK and China, which together accounted for 81% of the value of all art sales in 2016. Needless to say that the UK is dominating on Europe’s art market. In order to maintain its position, it is necessary for the UK to attract the highest value works of art available for sale at any one time in order to create a critical mass of art and antiques to attract international buyers. An interesting fact, that the British art market makes a substantial contribution to the economy in terms of the high-value jobs and skills it generates. In 2016 there were over 7,580 businesses operating, directly providing an estimated 41,700 knowledge-intensive and gender-balanced jobs.
Industry opinion is divided over how the online art market will develop in the next five years. Four in ten (41%) online platforms believe it will consolidate into only a few global platforms, whereas 30% believe regional and local platforms will dominate. Another 32% believe the online art market will remain category-specific and there will be room for niche players in specific art and collectible segments. The divergence in views highlights that the end-game is still open and that there is plenty to play for.