Market Monday: Hypernormalization
This week, three cases of the industry treating an extreme as the new normal…
...but first, a brief bit of personal-professional news: As of Monday, you'll also be able to find my weekly newsletter/recap syndicated on artnet News. Special thanks to longtime Gray Market reader and nascent Executive News Editor Julia Halperin for bringing me into the fold. Now let's find out whether having a substantially larger platform motivates me to pull any punches... or just throw them harder.
SLEEPWALK WITH US: On Tuesday specialty insurer Hiscox and market-analytics firm ArtTactic released the 2017 edition of their annual Online Art Trade Report. As usual, the study made colossal claims about e-commerce in the industry, including that total estimated sales reached $3.75 billion in 2016—a value alleged to account for “an 8.4 percent share of the overall art market,” based on the cumulative figure assigned by the 2017 TEFAF Art Market report. (You know, that one.) As usual, pundits and insiders around the art business immediately began spreading around these numbers like the clap would tear through a freshman dorm in a latex famine. And as usual, the methodology, which only maniacs like me bother to read, reveals the report to be almost a complete exercise in guesswork.
Since bulleting through every issue I see with Hiscox/ArtTactic’s approach would leave me with no time or ammunition to hit anything else this week, let’s just focus on the two most glaring problems. First, as I’ve written before, many, if not most, of the report’s grand results flow from a kiddie-sized pool of sources. This year, responses came “from 758 art buyers surveyed through ArtTactic’s client mailing list, Twitter, and Facebook.” Largely informed by those 758 anonymous art buyers, Hiscox and ArtTactic felt comfortable making multibillion-dollar proclamations about an industry rightly pegged as “gloriously-opaque” by Robert Read, Hiscox’s Head of Art and Private Clients and, based on this portrait on page 3 of the report...
...humanity’s world champion in obliviousness to camera placement. Even if small samples don’t unsettle you all on their own, ask yourself this: If our threshold for belief in an alleged news item becomes netting 758 responses on social media, won’t we all be living in bunkers, militia-barracks, or prison cells by Memorial Day?
The report’s second major problem bridges both the buy and sell-sides of the data. Regarding the collector survey, Hiscox and ArtTactic disclose the following wrinkle in the proverbial fine print of the methodology (emphasis mine): “Although the central focus is around fine art, we have in this survey also explored online buying habits of OTHER COLLECTIBLES.” Similarly, of the 132 galleries and dealers surveyed for the study, 60 percent “were linked to contemporary art, whilst 40 percent represent a wider selection of dealers in different collectible areas (such as photography, modern and impressionist art, design, furniture, decorative art, antiquities and old masters).” In practice, this means we have literally no idea what proportion of the Hiscox/ArtTactic numbers apply to artwork versus, say, Louis XIV armchairs or Neolithic ritual masks. No matter what a particular reader’s preferred niche may be, indiscriminately blending the data from all these disparate sources into one churning mystery stew makes the end result equally rotten for everyone.
Most important of all, this last flaw isn’t even exclusive to the Hiscox/ArtTactic report. Instead, it reappears to some degree in even the most trusted annual art-market reports, including those from TEFAF and Art Basel/UBS. And yet, after years of analyzing these reports, I can’t recall a single instance of anyone in the art industry ever sounding the alarms about this foundational problem. Instead, it’s been normalized into oblivion. Yes, the fine-art and collectibles markets share many qualities. But for those of us solely concerned with quantifying the art industry, treating all collectible numbers as equal is like treating fun-size candy bars and new toothbrushes as interchangeable to trick-or-treaters because, hey, they’re both prepackaged items you can easily chuck into a sack. But guess what? The kids care about the difference. And if we ever hope to get anything close to accurate big-picture data about the art market, we should too. [Hiscox/ArtTactic]
PRICE POINT OF NO RETURN: On Wednesday, NYC mayor Bill de Blasio came out in support of the Met’s making a move it “has been quietly talking to city officials [about] for a year,” per Robin Pogrebin: charging mandatory admission to non-New Yorkers. If the venerable-yet-recently-cash-strapped museum were to make the proposed change, it would represent the first time the Met had demanded anything more than a “suggested” or “recommended” fee since it began receiving state funding in 1893.
I’m not going to pretend that I can tell you definitively whether or not requiring admission for any segment of the population would winch the Met out of the fiscal sinkhole it hydroplaned into with Thomas Campbell behind the wheel. However, I do feel comfortable saying that, if it makes the switch, the Met likely won’t reverse the policy again even after it inevitably rights its balance sheet. Although more and more American art museums seem to go permanently admission-free every month, it’s worth remembering that in 2006 the Art Institute of Chicago, another of the US’s renowned encyclopedic jewels, became one of the few to re-institute a required rate after years of free entry. More telling, the $12 general-admission fee the Art Institute began charging adults back then has, depending on ticket-buyers’ residency status today, ballooned to between $22 and $27. And most troubling of all: As far as I can tell, the initial resistance to the rate-resuscitation (and its subsequent rise) has by now faded into quiet acceptance of the revised status quo. That might be great for any vaunted American museum’s bottom line. But it’s a troubling data point for anyone concerned that the arts are increasingly being herded out of the public eye and into the VIP section. [The New York Times]
ABSOLUTELY PREFABULOUS: Finally this week, my colleague Eileen Kinsella detailed a new entrepreneurial initiative by Manila-based collector and real-estate developer Robbie Antonio—one that is, in his own words, “really challenging the norm”: prefab private museums. In collaboration with starchitects Jean Nouvel and Christian de Portzamparc, Antonio’s firm, Revolution Precrafted Properties, will begin offering modular permanent-exhibition units that can be mixed and matched based on the needs of any aspiring collector—some of them for under $1 million, and nearly all of them fully buildable in six months to a year. Are you heavy into new-media works? Try copping a few soundproof-room modules. What if your storage unit is swollen with epic sculptures? Just order up the so-called “Big Hall” unit. And if you want your giant Calder to kiss the flesh of the evening, you can even select an open-air courtyard component like the one pictured below. Just make sure no one in the vicinity remembers what the Cloverfield monster looked like.
From a profitability standpoint, I think Antonio’s strategy might be brilliant. At the same time, the sound business logic for backing his enterprise also depresses the hell out of me. With the 21st-century rise of art advisers and, driving that profession’s growth, the proliferation of the buyer class I call COINs—Collectors Only In Name—acquiring artwork has increasingly become an exercise in outsourcing. The socioeconomically ambitious know all too well that, today, a high-end collection is a must-own for any youngblood hoping to be jumped into the established Gulfstream Gang that lords over much of our global capitalist world. But if you’re too much of a neophyte to know the art game, or too busy snorting Adderall and poring over profit & loss statements to do extracurricular research, in-demand advisers can simply deliver you all the instantly recognizable branded works you need for your very own “world-class collection.”
Revolution Precrafted is simply pushing this hands-off trend to the next level. Thanks to the firm's modular units, COINs don’t just have the luxury of building up their actual artistic holdings with minimal thought. They can also just as effortlessly build out their own private museums—the next logical plutocratic trophy acquisition—by literally ordering a la carte off a developer’s menu. Is this an event of significance in the art market? Absolutely. But will it create a “culture of significance” around the globe, as Antonio hopes his prefab division will do? That’s a proposition I would happily short if given the chance. [artnet News]
That’s all for this week’s edition. Til next time, remember: The biggest changes are sometimes the ones we don’t notice until it’s too late.