Go Social or Go Home — How Art Dealers Can Cope With a Millennial Collectors Generation.
These days, most people falsely believe that the art market is not affected by digitalization. The thesis, that art can only truly work and be sold after being physically exposed to the buyer, is legitimate. Not only because the current majority of the art market protagonists consist of people older than generations Y-Z and therefore have lived, learned and operated in mostly analog times.
Be that as it may, times change and society is shifting exponentially into digital times. Compared to earlier generations, millennials are socialized differently, think differently and perceive differently. Society’s transformation does not stop at art and its market.
This article will aim at mapping out distinctive requirements for the modern art market or rather modern gallery management, creating application approaches to help art dealers stay relevant and attractive to a new generation of art collectors.
Short and Sweet: Numbers on Art
The global art market sales volume was $45 billion in 2016, where $28 billion where generated through art dealers and $17 billion through auctions (TEFAF Art Market Report 2017). Online art sales in 2016 reached $3.27 billion, increasing by 24% year over year and representing 7,2% of the art market, according to the Hiscox Online Art Trade Report 2017. If the online art market continues to grow at that rate, it will reach $9.58 billion by 2020.
Even though the art market remains healthy, galleries are having a difficult time. According to a study by Magnus Resch (Management of Art Galleries, Phaidon) 55% of art galleries in the USA, the UK and Germany have an annual turnover of under $200K. Considering the obligatory 50/50 Artist/Dealer rule, the actual annual turnover is under $100K. The majority of sales in the art market are posted by just a few galleries (7% have a turnover of more than $5 million a year).
Digitalization and the lack of online presence are surely not the only reason for the critical economic state that a lot of galleries are in. Economic crises, over-gentrified city centers (rent prices) have to be mentioned first. All things aside, social media and others are essential to the survival of the modern art dealer, aiding in compensating for the areas mentioned above.
Millennials and Art
When asking collectors of any age about their consumption of art, one thing becomes abundantly clear: A survey by Invaluable shows, that almost a quarter of all art buyers find new art work via social media, leaving museums with 20% and galleries with 16% far behind them and therefore becoming the primary source of art discovery. Millennials obviously play the primary role in this transformation. 44% of younger millennials (ages 18–24) as well as 34% of older millennials (ages 25–34) say that they discover art via social media. Additionally millennials buy art online more and more, where they describe buying art as a longterm investment or a unique experience. Surveys show, that 52% of older millennials are inclined to buy art online. Almost one in four younger millennials say, that they would rather buy art online than in person.
“ I believe that the gallery model that we know is now completely outdated. I’m selling a lot of works now through Instagram and even through Facebook. In my opinion, going to a gallery — that’s over. Nowadays, if a collector sees a work on Instagram that he wants to buy, he doesn’t have to travel to meet the dealer to buy it. It means that the process is not as static as it can be in a traditional gallery. The world is getting smaller, but people have less time on their hands. Collectors often buy very expensive works now without ever seeing them in person. It’s crazy, but it’s the way the market has evolved and you need to be in touch with it.“ – Nicolas Hugo (independent-collectors.com)
Storytelling– Content is King
In addition to buying art as an investment, 92% of millennial art buyers talk about “some kind of feeling” (Forbes Magazine, 2016) as the determining aspect for the purchase. Art galleries have to ask themselves what this feeling is and how they can communicate it. How can stories and connotations be woven around the art purchase in an interesting and compelling manner, to create a rich and meaningful experience? The answer is strong storytelling via social media. Art dealers have to meet their future buyers in their native environment to be part of the dialogue. In this context, social media cannot be seen as an advertising platform — not to discredit Facebook and Google Ads as effective tools to reach customers.
Social media, especially Instagram, have to be understood as a path to supply millennials, interested in culture, with strong and compelling stories, to create an emotional bond between the art and the recipient — independent from any physical representation. Next to the added monetary value through attractive storytelling, social media contains two other significant potentials:
Firstly breaking down the stigma around the art scene as an exclusive social realm, that does not allow everyone to part take. The art market faces the reputation of not being accessible to everyone and having a high entry barrier, comparable to the one found in theater and opera. This status the art industry holds to this day, is due to the exclusive communication and economic positioning from past times, something completely outdated by todays standards. Enabled by the internet and later by social media, art became accessible to people of all social classes, simultaneously opening markets aside from traditional galleries and auctions, making purchases more accessible to everyone. Galleries have to be aware of these barriers and actively work on breaking them down.
The second potential lies within the cultivation of the next generation of art collectors, enabled through “new” media. The Hiscox Art Trade Report 2017 shows, that visually appealing high quality content is especially important for the online art collectors choice of platform or purchase at 52% (up from 42% in 2016) of all online customers. To put it in a nutshell, people are looking for more than just buying a piece of art. It is about an experience, consisting of an emotional connection and information about the artwork itself as well as the artist.
Successful gallery communications therefore have to be more than appealing storytelling, but at the same time authentic and informative. Art gallery’s social media and online presence is not only important before and during the art sale. Strong communication is equally important in the after sale process. The buyer needs to get the feeling of having made the right choice. This is important, not only for them to buy more art, but also vital for them to become a multiplier through WOM. Good forms of communication can be newsletters, blogposts and Q&A formats to keep the buyer informed on current events, prices, exhibitions, publications concerning the artist they already own art from.
Mobile Art
Lastly it is important to talk about another significant factor, vital for successful online and social media presence: Millennial’s buying habits via mobile devices.
90% of social media is consumed on mobile devices, which might give skeptics something to think about. Is it even possible for a mobile user to end up buying expensive art work via the social media presence of a gallery? Is purchase anxiety not to high to buy something as valuable as art? Turns out, that it is not. Even if it should not be the primary effort to exploit the potential of social media as a conversion channel, it is not that far fetched, that high end art purchases are the result of social media interaction via mobile: According to Hiscox, 32% of buyers used a tablet or mobile device to make their purchase.
NO SERVICE 24/7 is a berlin-based agency for strategic communication with a focus on brand consulting, social media campaigning & creative direction.
Feel free to get in touch for further insights and ideas on how to successfully market art in 2018. — contact@noservice.today
