This commentary on the first half, 2017 Postwar and Contemporary market share is available to AMMpro subscribers. Monthly subscriptions come with a free first month grace period. Subscribers are welcome to sign up for the service and cancel at any time before they are billed.
Artnet published some interim numbers for the Postwar & Contemporary art category in 2017 where they discovered that the top 25 artists account for a substantial minority of the dollar volume spent on art.
In the first six months of 2017, work by this small group of elite artists sold for a combined $1.2 billion—44.6 percent of the $2.7 billion total generated by all contemporary public auction sales worldwide.
We’re republishing the chart for two reasons. The first is that the list is inherently of interest. These market share numbers are telling in a market that is governed by power laws. But the second reason is because Artnet’s analysis of their own numbers is somewhat at odds with what the charts themselves show. We thought it worth going over the numbers again separately.
One observation to be made is that a half year sales period is a fairly random sample. Even comparing two successive half year periods is somewhat random. Throw in one from a decade before, and you’re not really doing much more than hurling spaghetti at the wall to see what sticks.
Provide a list for 2017 but not for 2016 or 2007 and we have no basis for comparison. How many artists survive from 2007? What does the difference in market share tell us when looking at the artists who appeared in 2007 against those in 2017.
Finally, before we take a look at the numbers themselves, how did Artnet come to this conclusion based upon the data they present?
It was not always this way. There was a time when the bluest of blue-chip did not rule the high-end art market with such a mighty hand. In the 1980s, the emerging class of major collectors was more focused on buying new art on the primary market—Jeff Koons, Cindy Sherman, Gerhard Richter—than snapping up trophies from the recent past at auction.
That paragraph is simply non-sensical. Show us a list of the top 25 artists at auction and their market share for any time in the 1980s so we can see what names were being bought and they differ from the collectors who were supposedly buying “new” art. Was there no old art being sold? And since “new” art is bought privately, how do they know more money was not spent on artists who are no longer considered valuable like, say, Mark Kostabi?
Set that aside and let’s look at the numbers we’re given. The top 25 names are 45% of the Contemporary market at auction. That’s up significantly from 2016 but down from 2007. (Since we know that 2007 was a peak year and so were 2014 and 2015, why not show those numbers?)
Choosing the top 25 artists is also an arbitrary category like the first half of the year. Within the top 25, a full half of the overall value or $604m comes from the top 5 artists. That means 5 artists account for more than 22% of the PWC market in 2017.
That reminds us that cultural markets like movies and books and music are “head” driven with long tails. It also tells us that within the “head,” or top 25 artists, there is also another “head,” the top 5 artists, and another, shorter tail. The same recursive pattern appears within the top 5 artists too.
It would be interesting to know if this is a consistent pattern or simply a feature of 2017. The sale of a single Basquiat painting in May accounts for the doubling between Basquiat and Warhol (and how does Artnet account for the collaboration works between Basquiat and Warhol which make for a $10m swing?) And that $110m Basquiat painting is what adds several percentage points to the the difference between 2016 and 2017.
Without the untitled Basquiat head, we would look at 2016 and 2017 as years where the top 25 artists had accounted for a substantially smaller portion of the spend on Contemporary art suggesting a trend away from any random assortment of big names and toward a broader market.
Breaking these numbers down further. Basquiat had almost 9% of the Contemporary market. That’s fairly low when we know Warhol or Picasso can dominate these types of markets to a greater extent. In 2017, Warhol had 4.5%. Lichtenstein and Richter were each 3%; Twombly was 2.7% and Bacon just under 2%. Again, these are not dominant market share numbers. From there the numbers only slide further until we get to position 16 where Sigmar Polke accounts for a clean 1% of sales.
It’s not clear what Artnet’s expectations were. And without similar breakdowns for other years both adjacent and distant, we cannot know how much these market share numbers differ from previous market phases. One suspects not a lot.