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On December 17th 2021, The 2021 KAMA(KAMS Art Market & Appraisal) Conference was held online under the title “Art Market Going Online : Changes, Chances, and Challenges.” The conference identified the market’s shifting trends and new consumers, and examined the trends in NFTs and the metaverse, two concepts that emerged as keywords last year. Furthermore, it discussed the sustainability of the online art market through a discourse on security and data loss in a digitized art market, the environmental crisis triggered by the digital industry, and the legal policies and economic prospects of the cryptographic art market. This article is from Session 1, Transition to Online : The Art Market and Collectors, in KAMA Conference.

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Three Myths About the Online Art Market—and How to Leave Them Behind Forever

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This article is about the online art market, which has never been more active than it is right now, and which I think is also still hugely misunderstood in some fundamental ways. The article tries to address those misunderstandings by dissecting three persistent myths about the online art market, and the ways we can move past them to something that is hopefully better for everyone involved.

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Now, my interest in, and my experience with, online sales predates the time I’ve spent covering them as an art market journalist. I got my start in the art world all the way back in 2005, as a front-desk assistant at a contemporary gallery in Los Angeles. Even back then we were doing some things that would be defined as online sales. What struck me about my time in the online art market back then versus the state of the online art market now is that less has changed than expected. So right before the pandemic struck at the end of 2019, the standard approach that most art sellers were taking to online sales focused on three channels: first, dedicated self-run websites; second, third-party art-discovery platforms, like the Artnet gallery network, Artsy gallery network, or Ocula; and third, social media. In the art world, that primarily meant Instagram (though there was of course some activity on some other platforms). Now, compared to 2019, one major difference was that social media wasn't anywhere near as big a presence on anyone's radar back in the mid-2000s. Instagram didn't even exist until 2010, which gives a sense of how much time has elapsed.

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Using this standard, three-pronged online sales approach seemed to put a pretty distinct cap on the size of the online art market. Then the COVID-19 pandemic struck. It changed the landscape almost overnight, as the data below helps to illustrate.

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© 2021 Artnet Worldwide Corporation

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This is a chart showing the total online art sales made at the three big international auction houses, meaning Christie’s, Sotheby’s, and Phillips, during the period from January through June in each of the past four years. The chart shows a modest progression from 2018 to 2019, and then this massive jump between 2019 and 2020. To put some numbers on the visuals, in 2019, the big three auction houses collectively sold about $95 million worth of online work in the first six months. In 2020, they sold over $1 billion dollars worth of online work during the equivalent period. That's roughly a 10 times jump, which was effectively unheard of in analysis of the online art market before. Although the chart shows only four years worth of data, we would also see a similar kind of progression if we extended the range all the way back to 2013: just modest increases year over year, and then boom, 2020 hits and everything leaps to a new level.

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Now, for more perspective on this phenomenon, it isn't just that there were a higher aggregate number of online sales happening, or a higher aggregate sales total by dollar value, in the first half of 2020. The average price of an artwork sold online also saw a dramatic year-over-year increase. In 2019, sticking with the three big international auction houses, the average price of a work sold online was just short of $11,000, or about ₩13,000,000. Then in 2020, that number increased to just short of $52,000 or about ₩61 million.

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Now, the standard perception of what contributed to this change—aside from the obvious fact that we were all shut up in our houses for an extended period of time—is that the pandemic fundamentally changed the rules of the online art market. But I actually don't think that's quite true. Really, what I want to argue in this article is that what started working online in 2020 was actually working well before the pandemic struck. In retrospect, the rules of the online art market didn't change so much as people's behavior towards the online art market changed.

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This leads us into the three myths…

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Myth #1. Online selling works best for a narrow, low-priced category of artworks.
The conventional wisdom for many years was that what sold well online were visually pleasing, color-saturated, Pop art-influenced prints made by big-name artists, in large editions, and ideally sold for around $20,000 or less. For example, in 2017, David Zwirner’s online viewing room did an entire exhibition of boldly colored Yayoi Kusama prints matching this general description, all priced between $15,000 and $20,000. The Kusama show sold out, reinforcing the idea that the conventional wisdom was correct.

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Landing page for Gagosian's first online viewing room, concurrent with Art Basel 2018. Courtesy of Gagosian.

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Katharina Grosse, Untitled (2016). Artwork © Katharina Grosse. Courtesy of Gagosian.

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But here’s the caveat to that conclusion. By summer of 2018, a Zwirner representative said that the gallery had actually sold works in its online viewing room that were priced as affordably as $1,000, but also works that were priced up to $500,000. Meanwhile, one of Zwirner’s chief competitors, Gagosian, launched its first online viewing room timed to the beginning of Art Basel in Switzerland in 2018. Gagosian took a very distinct approach to their online viewing room, which flew in the face of conventional wisdom by selling works by only 10 artists, with the lowest-priced work on offer—a Jeff Elrod painting—listed at $150,000. They sold the Elrod work and four others, including the most expensive work in their virtual booth, which was an Albert Oehlen painting priced at €950,000 or about $1.1 million. So, all of a sudden, Gagosian’s results suggested that a gallery could successfully sell unique works online at price points much higher than $15,000 to $20,000 (or even the $500,000 Zwirner had topped out at previously).

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Albert Oehlen, Untitled (1988). © Albert Oehlen. Photo: Rob McKeever. Courtesy of Gagosian.

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What Zwirner and Gagosian ended up proving over the course of the next year and a half was that their early blue-chip online sales were not an anomaly. Gagosian went on to launch a series of online viewing rooms. One of those viewing rooms debuted in spring of 2019, and it was dedicated entirely to a single work: an Albert Oehlen painting from 1988 that was priced at $6 million. Gagosian sold it within a few hours of opening the online viewing room. While the gallery would not confirm what the final price was, they did confirm that it was above Oehlen’s auction record, which at that point was $4.7 million. Then, the very next month, David Zwirner comes out and says, "Hey, guess what? In our new online viewing room, we just sold a Jeff Koons Balloon Venus for $8 million." This sale is doubly noteworthy because, on top of the price, it's also a sculpture. Part of the conventional wisdom was that galleries shouldn’t really try to sell sculptures online because they just don’t present well on a flat screen. Allegedly, nobody was going to go to a webpage and look at a three-dimensional object and say "Yes, I will pay a high price for that." Yet Zwirner proved that that wasn't necessarily the case.

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Readers might be tempted to write off these results because they came from two of the top galleries in the world. Nobody has better resources. Nobody has a richer clientele. So maybe no one else could have done what Zwirner and Gagosian did. But we can't really know because there were so few other galleries that were really making a dedicated effort online in that period. One data point that captures this idea: When Frieze launched its first online viewing room to replace the live fair in New York that was cancelled by COVID in May 2020, the head of the initiative said that they had done an internal survey of the exhibitors that were set to show at the fair—and out of more than 200 galleries, about 83% of them did not have their own online viewing room at that point. So, perhaps part of the reason that the conventional wisdom took root was because there just weren't a lot of other people trying to do anything else but sell attractive big name prints at modest prices in the pre-pandemic era.

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Myth #2. Online and offline are two separate sales channels.
This myth may seem pretty inarguable at first, but as soon as one scratches the surface of it, this very strict binary starts to fall apart. What do we mean when we say online sales? The average person out there in the art market would probably give one (or all three) of the following answers: first, online auctions; second, sales made through either those third-party platforms I mentioned earlier (such as the Artnet gallery network and the Artsy gallery network) and/or now increasingly, through art-fair online viewing rooms; and third, sales made directly through social media. While these are rare, they are not unheard of by any means. This is especially true now that deals can be struck via everything from Instagram DMs, to WeChat conversations, to the chat platform Discord (especially if we talk about NFTs).

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Adrien Meyer fielding bids for a Gustave Caillebotte painting at the sale of the Cox Collection at Christie's New York. Courtesy of Christie's

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Now, to understand the problem that arises from the conception of a strict binary between online and offline sales, let’s analyze what the auction houses have done lately. It's become a common practice over the course of the past several years for auction houses to take the works that are going to be in really premier sales, and send them on international tours. For example, last November, the marquee New York auction cycle was back for the first time since 2019. And one of the sales that went up during that cycle was the sale of The Cox Collection, which was a trove of Impressionist and Modern works that was museum-quality all the way through. Now, Christie's, which sold this collection, took it on a four-city international tour. It started off in Hong Kong, then they took the collection to Taipei, then to Tokyo, then London, before bringing it back to New York , where it was put on view in Christie’s galleries until the actual auction.

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Jeff Koons, Balloon Venus Lespugue (Red) (2013–2019). © Jeff Koons. Courtesy of David Zwirner.

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The collection sold incredibly well, bringing tens of millions of dollars over its estimate. Christie's announced after the sale that the breakdown of buyers for the works in the sale was essentially split down the middle. The auction house had about half the works going to collectors in the US, and they had about half going to collectors internationally. Some of those international collectors were not just bidding remotely, but were bidding online. This raises an interesting question. If auction houses have an online bidder who wins a work at a live auction, does the result count as an online sale? Keep that question in mind as we think back to Gagosian’s Albert Oehlen painting that sold for $4.7 million plus, or David Zwirner’s online viewing room that sold Jeff Koons' Balloon Venus sculpture for $8 million. These are multimillion-dollar artworks that were technically being sold online… but how sure are we that the galleries didn't have these works installed in their physical galleries’ back rooms so that collectors who were potentially interested could come by and take a look and get a sense of them in person? I'm not bringing this up because it's suspicious per se, but I think it's a fair question to ask. It also really starts to complicate this idea of online and offline sales channels being different.

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I can also tell you that there are now multiple transactions that essentially go something like what’s shown in the timeline below.

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A potential deal flow calling into question whether the sale should be classified as "online" or not. Courtesy of Tim Schneider.

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This hypothetical example starts off with an online inquiry by a collector that the gallery doesn't already know. That online inquiry then ends up transforming into a kind of informal meetup at an art fair. Say that the collector inquired from New York, and the gallery was based in LA but had plans to exhibit at the Armory Show. That would mean they could arrange a meeting at the gallery’s booth at the fair to continue the conversation. Suppose that meeting goes well. Then the relationship moves into an ongoing series of texts, calls, and occasional video chats that gradually deepen the relationship. One can send images back and forth online to get a better sense of what the collector is interested in. Then the collector actually comes to the gallery, which does a formal sales presentation for them in the back room, and they (finally) commit to buying one or more works.

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Now, very few people would say that this should be considered an online sale. However, at the same time, if the gallery and the collector weren't online, the sale wouldn't have happened. In that way, online and offline sales are really less distinct from one another than we tend to think. More and more businesses and lives end up moving fluidly back and forth between the online world and the offline world. If we think about online sales from that perspective, it will help give us a better sense of what might work and what might not work.

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Myth #3. As long as one builds an online storefront, buyers will find it.
Our third and final myth was a huge misconception before the pandemic, and it has become an even more insidious one after the pandemic, just because of the sheer increase in competition. In a piece I wrote in the fall of 2020 premised on the idea that collectors were getting burnt out by the high number of online offerings they were being hit with day in, day out, a very high-level private collector and museum trustee described what he was experiencing every day in his inbox as a "nonstop onslaught of art." He said that the only way that he could try to keep track of things was to start a dedicated folder in his inbox just labeled “art.” When he looked in this folder during our interview, there were 20,000 unread emails in it. The sheer concept of going in there and trying to sort through the messages was so exhausting that he couldn't even bring himself to do it. That's not an anomaly. A lot of people went through something like that experience, especially because once live auctions could no longer be held in the Western world during most of 2020, the auction houses decoupled themselves from the traditional auction schedule and started running online sales pretty much as often as they felt they could. And that really ramped things up. Then art fairs started doing the same thing. For instance, in 2020, Art Basel began running multiple online viewing rooms over and above the number of live events they would have had if they proceeded as usual in a COVID-free world. Then add in the fact that hundreds of galleries that never used to have their own online viewing rooms sudddenly launched their own online viewing rooms—and kept rotating them at least as often as they rotated their physical shows. In total, it's just, again, a nonstop onslaught of art.

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The problem becomes even more extreme when we zoom out a little further. The reality is that when we are trying to get somebody's attention online, whether as an art seller or anybody else, it also means competing with everything else that's online that somebody could be spending their attention on. I refer to this concept as the tyranny of options. People are now so overwhelmed by choice, by and large, that they'll often end up defaulting to the few most respected, most widely well thought-of brands or presences that are out there. This is why people gravitate to blockbuster movies. It’s also why, in the art world, people tend to gravitate towards the mega galleries and the major international auction houses. Because it's just hard to go out there and try to find a diamond-in-the-rough gallery, or an emerging artist that maybe hasn't even had a particularly noteworthy gallery show yet.

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There are so many more people in our world who are online, and there's now so much more content online. If a gallery asks someone to go to their online viewing room, they are also asking them to turn away from things like memes, the new pop music that just came out that they're super interested in, every movie or TV show that they could stream, online shopping opportunities, whether they’re into fashion or whatever else. They have to turn away from all of these things (and more) if they are going to go online and look at a gallery, auction house, or artwork. For art sellers, the tyranny of options means that just saying, "I have an Instagram account," or "I have a website," or "I have an online viewing room, that's enough" is not, in fact, enough.

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Jiajia Fei, who now runs, as far as I know, the art world's only digital-strategy consulting firm, said in the spring of 2020 that when it comes to an online space, it’s about more than building a space. It’s about building a conversation around it. A gallery called Unit London is a great example of this strategy. Unit London has been around since 2013. They started off as a sort of grassroots, pop-up-based gallery in the greater London area. And between 2013 and 2018, they leveled up to having a very posh, very refined white cube space in the Mayfair District, alongside the likes of Zwirner and Gagosian and Hauser and Wirth. Now, what makes Unit interesting is that they managed to make this leap without ever showing at an art fair. Instead, they started the gallery from the very beginning intending to build a digital community, to treat online engagement as the coin of the realm in a lot of ways. Everything that they did was going to be thought of through the lens of how it translates online, as opposed to the many, many galleries that essentially say, “We know we should have some kind of online presence, but let’s just bolt it on at the end.” What Unit ultimately ended up doing, right before the pandemic, was to hire a dedicated content team of four people, which is more than anyone other than a blue chip gallery would normally hire for this purpose. The point is that Unit really believed that if they weren't actively responding to people online, if they weren’t creating conversations online, and if they weren't giving people a real sense of why they should be looking at what the gallery was up to online, those people probably weren't going to be particularly interested. It goes back to the tyranny of options and, in some sense, it even goes back to the idea of online and offline not necessarily being separate channels, but rather two sides of the same coin. And that, in turn, demands treating the online world with as much of a sense of dedication and importance as the offline world.

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To close out, let's revise the three myths about online sales. The first was that online selling is best for a narrow, low-priced category of work. The revised reality is that online selling can work for any artwork at any price point. The second myth was that online and offline are two separate sales channels. The revised reality is that most art sales, or at least many art sales, now flow across multiple channels, and should be treated as conversations that need to be coached through multiple phases that toggle back and forth between online and offline. The third and final myth was that as long as one builds an online storefront, buyers will find it. The revised reality is that engagement drives discovery and sales. If an art seller does not find a way to go out there and engage a digital audience, then very few people are going to find them by happenstance, let alone love what they are doing enough to make them a part of their lives and their purchase history. Keeping all these ideas in mind will go a long way towards helping art sellers find more of a foothold in an increasingly competitive, increasingly active online market, whether the seller in question is a gallery, an auction house, or even an independent artist.

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