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Cheat Sheet: Art Basel & UBS Report 2019

feralhorses - 5th June 2019 - 0 comments

The 500 Page report repared by Dr. Clare McAndrew Founder of Arts Economics in a nutshell by Feral Horses

The Global Art Market in 2018:

  • Sales in the global art market in 2018 reached $67.4 billion
  • Sales in the three largest markets the US, the UK, and China accounted for 84% of the global market’s total value
  • Despite Brexit worries, the UK had a relatively strong year of sales, with values rising 8% to just under $14 billion

Dealer Sales:

  • Dealer sales in 2018 reached an estimated $35.9 billion
  • The best-performing segment for sales year-on-year was dealers with turnover between $10 million and $50 million, the poorest performance was in the lower end of the market, below $250,000.
  • Finding new buyers remains the biggest challenge for dealers in 2018.New buyers were more important for dealers with lower turnovers than for those at the highest end.

About the Buyers:

Sales to private collectors dominated the dealer sectors in 2018 at 68% of total values.

On average, just 25% of buyers were female, and they generated one-third of the sales values in the sector in 2018. Female buyers were in a minority in every sector, with a slightly higher average in the Contemporary market and other fine art sectors.

Female buyers generated the greatest share of sales in the other fine art sectors, such as Old Masters and Impressionism, and the least in the Modern sector.

Artist Representation and Gender Issues

  • Dealers working solely in the primary market had the lowest turnover at $500,000 versus $5.1 million for those in the secondary market only. Those operating in both had $1.8 million.
  • For primary market Galleries — 63% of their total sales came from their top three artists, 42% of value accounted for by one leading artist.
  • Large primary-market galleries represent fewer female artists. Those with turnover up to $1 million have 38% female artists, versus 35% for over $1 million, and 28% for over $10 million.

Auction Sales:

  • Sales at public Auction Sales of fine and decorative art and antiques reached $29.1 billion in 2018 (88% of total = US 40% China 29% UK 19%)
  • Works of art selling at prices in excess of $1 million accounted for 61% of total sales value in the fine art auction market but for just 1% of lots sold.
  • Post-War and Contemporary sales accounted for half the fine art auction market’s value in 2018 — reaching $7.2 billion

The Number of fine art auction transactions declined 7% year on year in 2018

Female artist’s work do not sell better now than a decade ago, with just 8% of total lots sold in 2018 versus 6% in 2008

Most of the Highest priced lots in the Post-War and Contemporary sector were sold in New York in 2018

The auction market for works by living artists increased by 23% to $3.3 billion in 2018- a larger increase in value than the Post-War and Contemporary sector.

Art Fairs:

  • Art fair sales were estimated to have reached $16.5 billion in 2018
  • The share of the total value of global dealer sales made at art fairs has grown from less than 30% in 2010 to 46% in 2018 (dealers took part in four fairs in 2018)
  • From a sample of 82 fairs and 27,000 artists in 2018, only 24% of the artists exhibited were female.

In 2018, dealers reported spending an estimated $4.8 billion attending and exhibiting at fairs, a rise of 5% year on year.

Organisers at very large fairs report that often only about 5% of the visitors attending are “serious buyers”, while this share is often much greater at smaller, niche fairs with lower visitor numbers

Online Sales:

  • In 2018, global sales in the online art and antiques market reached an estimated $6 billion — 9% of the value of global sales (e-commerce 12%)
  • Most online-only companies still sell the majority of their works in the segment of $5,000 and below
  • 93% of millennial HNW collectors reported that they had bought from an online platform

Although the bulk of works sold in volume online were at low prices, with 77% selling for less than $1000, there is significant share of value at higher levels

Although the Online Market has Maintained a steady increase in Sales; its most critical function continues to be accessing new buyers

Global Wealth and the Art Buyers:

  • Surveys of HNW collectors in 2018 revealed that 46% of the collectors surveyed in Singapore were millennial collectors and 39% were in Hong Kong.
  • While galleries and auction houses were the most commonly used channels for purchasing, art fairs were highly important in Asia, with between 92% and 97% of collectors from Hong Kong and Singapore having purchased from an art fair.
  • Collectors from the millennial generation were considerably more active art buyers than others, with 69% having purchased fine art and 77% having purchased decorative art in the period from 2016 to 2018.

While the Art trade may often seem insulated from economics and politics, sellers’ plans are often heavily influenced by their views of the strength and stability in the economy and whether it is perceived as a good time to sell

The Breakdown of collectors by gender was 67% male and 33% female, with the largest female representation in Hong Kong at 39%

Collectors tended to buy works by living contemporary artists, which made up 57% of the works in their collections

The most frequently used channel was a gallery or dealer, which was also the most preferred channel for purchases.

62% of collectors felt that the art market was transparent in terms of the information they needed to manage their collections

Economic Impact:

  • 310,700 businesses operate in the global art and antiques market, employing close to 3 million people
  • The gender breakdown of employment in the top-tier auction houses was 65% female, while second-tier businesses were more gender-balanced, with an average of 52% female employees, 61% of those working in the dealer sector were women.
  • The global art trade spent $20.2 billion on a range of external support services directly linked to their businesses supporting 375,030 further jobs.
  • The largest area of expenditure was on art fairs, which reached $4.8 billion, representing 24% of total ancillary spending. The second, largest area was advertising and marketing, which totaled $3.2 billion, an annual increase of 12% after two years of decline

As more sales move online, the traditional divide between auction versus dealer in everything but the top tier of the resale market will conceivably become less relevant.

Brexit will provide the UK with the chance to conduct a comprehensive cost-benefit analysis of several European directives applied to the Art Market.

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