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No more a hobby of the rich: How online platforms make art accessible to all

No more a hobby of the rich: How online platforms make art accessible to all

No more a hobby of the rich: How online platforms make art accessible to all
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By Manali Rohinesh  Nov 29, 2019 7:11:47 PM IST (Updated)

Speed, convenience and access to inventory and information made online buying of art so attractive.

Collecting and flaunting great art is a hobby of the rich, and it has always been this way. Or is it? Even if the absolute top-end masterpieces are out of the reach of these people, because they are mostly in museums, there are plenty of upcoming artists, whose works are coveted. But how are offline and online galleries doing in this business? Are they raking in the money? What about the buyers? Whom do they prefer?

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Artsy, which is an online art platform, released an Online Art Collector report, which stated that “at Artsy, we’ve seen 58 percent year-over-year growth in the volume of sales on the platform from our 3,000+ gallery and auction house partners.” Meanwhile, offline players like Christie’s, Sotheby’s and Phillips are enhancing their online presence. In this report, Artsy surveyed one million users, across 99 countries, and received 5,807 responses, including 3,993 from art buyers.
What the survey showed was that online buyers continue to remain the same set of people who were buying offline anyway. So there are no 20-something kids who have become billionaires overnight, looking to expand their portfolios. If anything, the buyers have been collecting art for as long as 20 years and now like the price comparison that they can do online and the variety available, all on one platform. Both newbie art shoppers and more experienced buyers like the transparency that websites offer. Also, they are not intimidated by them either, the way they are with auction houses and offline galleries.
This is something Vishal Singhal of Art Zolo, an online art gallery in India, also agrees with. He does have an offline gallery in Jew Town in Cochin, and he told me that he set it up because he had a lot of stock piled up and saw an opportunity to sell them because the Kochi Biennale, which is a popular event, gets a lot of visitors. He should know since he’s from Cochin and will be aware of the tourist scene there too. But he admitted that the offline gallery is purely subsidised by his online one.
So here is what the Artsy survey came up with:
  1. The majority of online art buyers spend under $5,000 on 1-2 pieces of art every year. This budget is equal to or marginally higher than what was reported in other surveys done by UBS and Art Economics. This means that the perception that online collectors spend less is wrong.
  2. They do buy at lower price points but buy more of it, almost purchasing an average of 8 artworks in a year. So as their budgets increase, so does their volume.
  3. Nearly 64 percent reported they had purchased art online in the past. Twenty-one percent online buyers reported that they spend 75 percent or more of their annual art budget online; 15.3 percent reported spending 50-74 percent of their budget online. Thirty-five percent buy art as an investment and only 26 percent did so hoping the work will appreciate in value. Thirty-eight percent reported spending about the same amount online that they did in previous years, and only 22 percent reported spending less of their art budget online.
  4. Speed, convenience and access to inventory and information made online buying so attractive.
  5. Total budgets have remained flat in the past three years but one-third of buyers have increased their online budget transactions.
  6. More than 50 percent of buyers have been collecting for less than 10 years, and 32 percent are under 35 years of age. But, collectors aged 35-44 are more likely to have purchased art online.
  7. Twenty-four percent of women buy art because they want to support artists, while 39 percent of men buy art as an investment. A collector who spends $5,000–$9,999 on art annually stated in the report, “I collect what I can afford, and that I think I can resell at some point. I think of it as my savings account on my wall. It should hold its value.”
  8. Around 4 percent of collectors who spent less than $5,000 in 2017 and 2018 were expecting to increase their budgets to between $5,000 and $10,000 in 2019.
  9. Online buyers are active during their peak earning years and are not looking to use accumulated wealth to maintain a high art budget, as they near retirement or even post-retirement.
  10. Fifty-seven percent of the new buyers said they would buy more art online. People who had been buying for only one or two years also indicated that they plan to spend 38 percent more online. Even high-end buyers, those spending over $250,000, are looking to buy more from online art platforms.
  11. Collectors with smaller budgets preferred buying from the artists themselves. People with more money (over $50,000) went to auction houses. Twenty-six percent reported purchasing art via Instagram or other social networks. Around 66 percent keep track of art news using social media.
  12. While there are many reasons to buy art - the one used most – 71 percent stated that they wanted it as a home decor item, 67 percent said they wanted it as a source of inspiration. Seventy-eight percent said they bought art for aesthetic reasons. Also, 51 percent want to support artists and 36 percent want to support their artist friends.
  13. Men were 53 percent more likely than women to have bought art at auction, 33 percent more likely to have purchased through an art advisor, and 20 percent more likely to have purchased it online.
  14. Not a flash in the pan 
    Online art sites/galleries are here to stay and they are no flash-in-the-pan operators. Apart from reasons like transparency with regard to prices, convenience, etc, they also provide access to art fairs in other countries which collectors can’t always attend in person. Then there are friction-less transactions, a no-pressure environment and competitive pricing, which all combine to make this a great way to invest in art.
    Artsy sales data proves this because “artworks uploaded with their prices publicly available are between 2 and 6 times more likely to sell than similar works with their prices hidden.”
    As a younger generation (Gen Z), who do almost all their shopping online, comes of age, online art galleries will appeal to them for all of the above reasons. But, in order to make art affordable, all art galleries also need to pay attention to EMI options, and they are doing so, by allowing people to pay in 4-6 installments.
    ArtMoney, a US firm, which provides interest-free financing over 10 months stated in the report that “its partner galleries have seen the average price of artworks purchased by collectors who use the service increase by 2.5 times, as well as a 200 percent increase in the conversion rate for artworks on which Art Money is offered as a payment option.”
    So, the myth is busted that buying art is only a rich person’s hobby. It does need a certain amount of disposable income, but anyone with some amount of money to spare can start slowly, pick smartly (as with any investment), and grow rich. Or at least, have an aesthetically beautiful home!
    Manali Rohinesh is a freelance writer who explores financial and non-financial subjects that pique her interest.
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