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Between Commerce and Art. About Galleries and Market

Article  /  CarolinDenter   CriticalThinking   Debates   Market
Published: 29.01.2019
Carolin Denter Carolin Denter
Author:
Carolin Denter
Edited by:
Klimt02
Edited at:
Idar-Oberstein
Edited on:
2019
.

© By the author. Read Klimt02.net Copyright.

Intro
Typically an art gallery is a small business that sells the art which it exhibits. The profits made from sales should cover the cost to run the business, and, in a successful gallery, will also turn a profit. But how can a gallery, especially for contemporary jewellery, survive successfully? How do they manage their artists and sales? What struggles do they have? What can be improved in the jewellery market? And what do they think about competition in the gallery scene? These questions and more will be discussed in Klimt02 published articles during the next weeks and months. The starting point for the new series is this article, where we screen the market and gallery scene in a series of 12 interviews with some of the most renowned gallerists and biggest players shaping the contemporary jewellery market.
Let's have a closer look at the „abstract“ idea of the gallery. There are different types of galleries, and each of them satisfies art lovers with different interests. And of course, every gallery wants to be the best in their niche. In this very wide field it is hard to find a good starting point to dive into this diverse subject. Beginning this topic at a familiar place for myself, I tried to find out more about the German art market, which seems to be based and rooted in statistics.

The largest study to date on the German-speaking gallery market, created by art dealer and critic, Magnus Resch, author of "Management of Art Galleries.” His perspective does not paint a nice picture of the gallery or the art market. In a survey featuring over 1000 fine art gallereis he found that, “On average, galleries make a small profit, in the German-speaking countries around 40% of the 2,000 galleries surveyed make losses, average sales are around 471,000 euros, and profits around 21,660 euros (i.e. 4.6%).” His study showed that the vast majority (68%) of galleries have little more than one permanent employee. Only 4% employ five or more people. What they have in common is that employees generally have knowledge of art history, but fewer management skills. It is not surprising that there is a lack of knowledge about objectives and target groups, competition and cooperation, product differentiation and service concepts.



A visitor studies Andy Warhol’s 'Dollar Signs' in Sotheby’s London showroom. Photo by Mary Turner


But the successful galleries do exist. Defining what makes an art gallery successful, or even one of the world's "best" is vague and difficult. Often those that inevitably rise to the top represent only well-known artists and have a global presence. This requires a lot of communication with collectors, art enthusiasts and with other gallery owners. Research of who is interested in the offered pieces might also be conducted to gain better marketing insight. But beyond commercial success, a great gallery has the ability to continually challenge the way things have been done in the past, supporting new, fresh artists, and political work which embrace the expansion of existing and new mediums of represented artists. To do this, the gallery owner must know the artist and his or her work very well and make use of their contacts within the art scene that have grown over the years. This seems to demand a lot of experience both personally and professionally.

Nevertheless, being a gallerist has become an increasingly desirable profession. Gallerists and curators, which can be the same in many cases, seem to be the new decision-making force in the art scene. They decide after all, how art is presented to the public, how it connects with culture and how it is made visible within the culture. A gallerist is not only the creator of an exhibition but professionally works in a wide range of activities, whose name itself can become a brand and a guarantee for quality.

I have always been fascinated by the profession of the gallerist because it is the perfect position for someone who wants to learn, explore, collaborate or criticize, as well as innovate and promote new concepts in the arts. On the other hand, it seems that a gallerist has to dedicate a lot of private time to their work to be considered a serious and competitive professional. Or perhaps it’s about passion? Nevertheless, being a gallerist takes a lot of passion and a driving force to establish the contemporary jewellery market, to develop, and improve it.


David Shrigley, installation view at Anton Kern Gallery, May 2015.


The ways of professionalizing the contemporary jewellery market is ambiguous. Gallerists specialized in contemporary jewellery might have a difficult initial position in the larger art market itself because of an ongoing debate on the value and categorization of contemporary jewellery. Is jewellery art? Does it need to be art? Many gallerists say, of course it is art! The galleries representing contemporary jewellery, are labeled fine art galleries, the gallerists call themselves art dealers, they go to art fairs, the jewellery gets published in art magazines, and so on. We might need to look at the big brother of our contemporary jewellery market, the general art market and copy some mechanisms: An established standard followed by a common language, references, and communication. Thinking about professionalizing the contemporary jewellery market, we have to consider the dark side: with the rise of expectations, the pressure will increase enormously, especially for younger generations of artists. The dominant position of galleries can be dangerous for the artists: a gallerist will promote certain works of a rising artist due to his or her renowned position and potentially encourage others to do the same. Their colluded investment could create a market for the work virtually overnight, along with the attention reserved for the choice artist of the moment. Or what is a phenomenon to me personally is how special artists are promoted and exclusively commercialized, which restricts the contemporary jeweller market to the accessibility for younger and emerging artists.

However, the monopole of galleries has been questioned by some new global forces coming from the digital world. To name the largest competition and surprisingly as well in some cases the quickest advancement for some contemporary jewellery galleries: digital galleries and online sale platforms, such as Artsy, Artnet or Artsper, to name a few. If you never have heard of them, you should:

Today, Artsy is far and away the biggest player in the online art market. 1,800 galleries pay Artsy from $425 to $1,000 a month to be members. Artsy says that it facilitates over $20 million in art sales each month, with an average distance of 3000 miles between the buyer and seller. "The art market is opaque and intimidating, but the internet gives more people the opportunity to participate," co-founder Sebastian Cwilich told the New York Times in January 2018.



Screenshot from an Artsy Video.


Artnet, the most important competitor and just like Artsy from the USA, is pursuing a similar strategy. But like Auctionata, the company is struggling with the problems of the digital art trade: in 2016, Artnet grew by only 0.6 percent with 17.4 million annual sales.

The New York startup Artspace is also trying to establish themselves as a leader in the digital gallery market industry. Liveauctioneers.com, 1stdibs.com, and Paddle8, which were bought out of the insolvent Auctionata by investors, are regarded as the other major players on the market.

In addition to these specialized providers, there are also two important names that are usually less associated with art galleries: Amazon and eBay. Both offer a variation of a digital gallery - Amazon with its Fine Art department, eBay with the Collectibles & Art section - to the visibility of their multimillion public featuring primarily only low-priced art objects.
So, do the existing online sales platforms provide more transparency to the art market and luxury business? Is there a need for this and what impact does this have on the art market outside of the internet?
Additional services which could be helpful, have been revealed in an article by the German newspaper “Die Zeit.” According to them the most interesting aspects of Artprice, Artnet and co. are the lists of auction results. This list can help the audience get a better understanding for what fine art costs. In the case of more recent contemporary artworks, prices and estimates from auction houses reflect a very limited extent of what buyers in galleries spend on artworks of particular artists. “For example, the Düsseldorf based gallery, Beck & Eggeling recently (2017 - 2018) offered objects by the artist Tamara K. E. for 10,000 euros at the Vienna Contemporary Art Fair. Databases, on the other hand that record prices for some large-format paintings are priced in the range of 1500 and 2000 euros.”

This does not mean that the prices of galleries are too high. Due to the fact that the majority of works auctioned are older pieces, this allows the artist's career to attract attention and the value of the work to increase.



Auction lists from Artsy, Samples List



The question remains, how do galleries which pay global players for additional services, profit from this? These online platforms are built to sell art, but according to an article published by the New York Times, it is doubtworthy whether these platforms will generate any noteworthy sales among the listed galleries. Articles written by artists or journalists state that these platforms are not generating many online sales. However it does contribute to more offline sales (such as someone sees a piece of art online, and buys it later on a fair/ exhibition).
This is a principal I can relate to and identify with since I have been working for Klimt02, which is an online platform for the communication of contemporary jewellery. We share parts of this market including its advantages and challenges, as well as some of the same questions to the topics mentioned above. It shows that, even though there are not many ways for online sales, yet, the marketing and promotion of artists and their artwork online in the digital gallery space is as important as fairs or exhibitions. I accept that the art and jewellery market will never be 100% an online market, since there will always be a need to physically see or wear a piece of art or jewellery in person, at least above a certain price range. (A study on sales at the art market proofed, that sales above 100.000 pounds online are almost non-existent). Learning more about some rules and accept guidance from professionals in the online business can perhaps help to evaluate your own goals and improve the market.


Discussing art can require talking about many different things. To decipher the enigma which is the art market is a good chance to help us understand the immensity of this subject. Do you think this is worth discussing?
 

About the author

Carolin Denter completed her training as Goldsmith at Master School for Craftsmen in Kaiserslautern in 2013. In 2015 she made an Internship at Klimt02, where she is working since 2016 as Content Manager. In 2017 she graduated with a Bachelor of Fine Arts in Gemstone and Jewellery at University of Applied Science Trier, Campus Idar-Oberstein. After her graduation, she started working part-time as Marketing and Design management Assistance at Campus Idar-Oberstein in the Gemstone and Jewellery Departement.
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