"Average Is Over" + the Future of Art Sales II: The Endangered Species

Yesterday, I covered the implications of Tyler Cowen’s “average is over” thesis for the responsibilities of future contemporary art gallerists. I concluded that, as collectors become ever more comfortable with the notion of online buying, the most valued gallerists will excel in a talent management/artist support role rather than pedal-to-the-floor sales. To frame the next phase of the discussion, I’d like to pull a Dickens and resurrect two ghosts of art sales past. These men offer a device that, like Scrooge’s own spirit guides, we can use to gain perspective on the sprawling totality of the issue.

Most contemporary art fans know the name Leo Castelli. For the uninitiated, Castelli was indisputably the most celebrated and vital gallerist in the postwar New York art scene. He is credited with discovering and developing hall of famers like Jasper Johns, Roy Lichtenstein, Robert Rauschenberg, Frank Stella, and Richard Serra, among enough other impact names that absorbing the whole list at once threatens to detonate heads a la Scanners (NSFW). One of the core qualities that made Castelli so revered was his passion for nurturing artists, especially young ones still emerging from the chrysalis. Castelli pioneered the practice (much less frequently used today) of putting some of his artists on a monthly stipend regardless of whether or not their work sold, so that they could focus on innovating rather than clipping their own wings to try to pay rent. He is essentially the prototype for the gallerist who will thrive in the “average is over” future. 

However, one of the reasons Castelli could be this shining benefactor was that he hired Ivan Karp. Although nowhere near as widely known as Castelli, in 1968 the New York Times dubbed him "New York’s deftest and most enthusiastic salesman of [Pop] art.“ (Note: emphasis mine.) The two men were polar opposites. Whereas Castelli was genteel, Karp was brash. Castelli spoke softly, while Karp’s voice thundered. Castelli was worldly - he lived in Trieste, Vienna, Milan, and Paris before arriving in New York in 1941 - but Karp was strictly local: born in the Bronx, raised in Brooklyn. Even their appearances were yin and yang. Castelli wore crisply tailored, slim-fitting suits that would have landed him in the pages of GQ today. Meanwhile, almost every description of Karp I’ve seen includes the phrase "cigar chomping,” and he would eventually go on TV looking like this. (Full video available here.)

Most importantly, though, Karp was the sales hammer that the erudite Castelli never wanted to be. Castelli would wax rhapsodically about the available works in the exhibition his clients had come to see, but when it was time to talk numbers, he summoned Karp. By all accounts, the two men formed a dynamic team. Karp worked as Castelli’s calloused, hardened pimp hand from 1959 to 1969, and the gallery went on a historic critical and commercial run during that decade. The run ended in 1969, when Karp left to open his own gallery, OK Harris, a moniker he invented because it was “a tough, American name that sounded like that of a riverboat gambler.” I feel safe presuming that Castelli never considered this criterion for titling anything in his own enterprise.

Karp was exceptional in his sales skills, his boldness, and his work ethic. But he would no longer be exceptional in his temperament within the contemporary art market. Today it seems as though for every Castelli-style nurturer running a gallery, there is a Karp-style salesman captaining another. There are no studies I can point to in order to verify this statement; it’s an anecdotal observation from my decade-long immersion in the field. But considering we’re talking about an alleged $60+ billion growth industry increasingly influenced by hedge-fund managers in which art flipping has run amok, I don’t think it’s a terribly controversial one. The ratio may not be 1:1, but both camps are well-represented.

This philosophical split has helped define the landscape of contemporary art sales. I always use the term “gallerists” to describe those who work directly with artists to develop, exhibit, and sell new work. But gallerists are distinct from “dealers,” or art sellers who traffic exclusively in the resale market. Dealers often become dealers because they have neither the desire nor the patience to spend their days collaborating with artists; they would rather just consign artworks from other sources or buy it from its creators outright - an arrangement which also gives them the freedom to act independently of its makers’ concerns thereafter. It’s a simpler, cleaner arrangement for those in the field more inclined to strict deal-making than engaging in the unique agonies and ecstasies of the creative process. It’s the path one would expect a Karp to take today.

So if the option to become a dealer exists, why would a modern day Karp want to open a gallery? In many cases, the answer is strictly inventory. Being a successful dealer requires one of two assets. The first is a many-tentacled network that allows a dealer to source art and sell it on consignment to his own clients, without ever needing the capital to acquire it himself in the interim. The second is a behemoth war chest that allows him to build up inventory through acquisitions he can then resell. But both of those assets can be hard to come by. So if a modern day Karp wants to sell art strictly for opportunity’s sake, the fastest and most cost-effective way to get started is to work with artists who can generate inventory for him.

Still, for a Karp, being a gallerist is only a means to an end: the endorphin rush of selling and the profit that comes with it. If the rise of online and remote sales removes the experience of “physically selling” from the equation, then the Karps lose a major incentive to become gallerists at all. In fact, if we accept the “average is over” premise, then not only will the Karps be disinclined to open galleries, there will no longer be a demand for their services within the organizational structures of Castelli-style galleries, either. The digital marketplace - and more importantly, art collectors’ increasing comfort with it - looks positioned to drive the Karps to extinction in this industry, both as gallerists themselves and as valued staff members in other galleries. It will essentially mean that they can only be dealers… or something else entirely. 

But what would that mean for the overall number of galleries? The vanishing of the Karps could create a market share vacuum capable of hoovering in an equal number of Castelli type replacements. But I think it’s much more likely that the hard-sellers are never replaced at all, and the overall number of physical galleries plummets, while the quantity of online-only sellers skyrockets. In the next installment, I’ll explain why, plus machete my way through the jungle to reveal what the macro landscape of the industry may look like as a result. 

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