6 business trends affecting the art world – Part 2

Posted on January 19, 2016 · Posted in Blog

image-business trends affecting the art world - part 2Global competition, rising art prices and the power of art collectors are just a few of the trends affecting the art community today. As we discussed in our prior post, over the last year, we have had the opportunity to speak with many artists, gallerists, collectors and advisors and we are sharing their insights along with our own experiences working with this community. Our goal is to start a conversation about how to mesh the business and financial side of art with the creative and personal side so that the art community can continue to survive and thrive.

Here are 3 more trends in the business of art.

4. Galleries as businesses. There is a big divide in how people view the business decisions of galleries. Some fear a shift in gallerists thinking more about money and less about art. These individuals see the galleries taking young artists and molding them to produce art that they feel will sell and connecting them to a defined but growing collector base. However, others believe this is a necessary move as galleries must start to see themselves as small businesses that must find a market to survive. They see this as a possible step in the right direction. Making the small and mid-size galleries more viable again benefits the many mid-career artists now losing representation because the galleries that have represented them have closed their doors because they can no longer keep the business afloat.

5. Artist loyalty. This concern goes hand and hand with the issue of global competition as Art has become bigger and bigger business. The pull of fame and money has made it tougher for galleries to work as they have in the past by nurturing young artists and helping them achieve success throughout their careers. There is now a need to offer them more services and recognize the changing times or risk losing them. In turn, there are concerns about artists being pressured to create art for defined audiences and art schools contributing to the problem. Some have said it is the influx of so many more artists than in the past who are graduating from Art School and they worry that too many artists seeking to have their voices heard is making it tougher for all artists. Others bemoan what they see as the Art Schools churning out students looking to sell to a defined audience at the same time that they are losing their creativity as artists and are failing to break new ground. Their argument is that schools are producing students with the idea of business over art. As one artist said “Creating one Toyota after another.”

6. Focus on business to detriment of personal finances. Like many small business owners, the majority of gallerists admit that a disproportionate share of their wealth is tied up in their business or art work itself. Too few have taken steps to diversify their holdings and try to reduce the risk that is inherent in the art world by seeking other asset classes to invest in and spread the risk. The same can be said of more successful artists who are not planning adequately for their futures and are not taking the necessary steps to secure their financial stability. Interestingly, the gentrification of artist communities has created a lot of untapped wealth as well as financial burdens. Some artists who have lived in these areas for years are finding that their space is worth a great deal of money. Alternatively, newcomers are being priced out of the real estate market, which just adds to their financial burdens.

These are just some of our findings. What do you see as the most significant change going on in the art world? We would love to hear your opinions on the subject.

Are you an artist, gallery or collector looking for help with your own financial challenges? Contact us for a consultation.