With sales postponed and auction houses remaining closed because of the coronavirus pandemic, there has been a rapid shift to the digital marketplace, data from Invaluable, the Boston-based online secondary-market platform, reveals.
The online consignment platform, which was founded in 2009, partners with auction houses to host online sales for around 5,000 sellers. The company has released figures showing the move online that swept the market a few months ago came following a sharp decline in total revenue in early March. According to the firm’s CEO, Rob Weisberg, Invaluable saw a 70 percent increase in new houses joining the platform in need of an online solution. Weisberg said auction houses began moving online after a three-day crash. The shift, he said, continued in April and May—and is likely to continue for the next year and a half. Findings from a data set of 20,000 sales over the past year show that, on March 9, the total auction hammer was up 19–20 percent year-on-year. By March 12, Invaluable’s report shows the overall hammer had dipped to negative 57 percent. As auction houses regain their footing, Invaluable’s data shows a projection of total hammer value to be positive by mid-July.
Invaluable also said it saw an increase in online bidders, up 39 percent, as well as a 52 percent increase in digital buyers—numbers that correlate with what top auction houses Christie’s, Sotheby’s, and Phillips have been reporting. Hammer volume has seen an increase, up 277 percent, across the consignment platform. According to Weisberg, the increased digital sales activity has also brought higher price points for individual lots.
“We’re starting to see a major increase in the share of gavel for digital channels,” Weisberg told Art Market Monitor, adding that transactional activity for live-only sales and timed auctions—sales where there is a virtual bidding window—has “skyrocketed.”
Invaluable’s report included news of staggering increases in digital sales activity. Invaluable said it saw a 14 percent year-over-year rise in online auctions on March 9, just before much of the world closed down because of the pandemic. By mid-April, there had been a 607 percent year-over-year rise, the report said.
According to Invaluable, there were some quick adapters to the digital sphere, including the Los Angeles–based John Moran Auctioneers, New York’s Shapiro Auctions, Doyle Auctions, and others. “Migrate online, or hang it up” was how Weisberg described the mood right now. The third-party digital platform is seeing its clientele expand as the industry’s traditional offline houses shift to virtual means. “Houses that have historically never done online auctions or live auctions with digital consumers are basically doing them now 100 percent online,” Weisberg said.
“We’re starting to see this rolling reopening and this logjam of sales,” Weisberg said, referring to the delayed auctions planned for the summer. And now, Weisberg said, the main concern across the auction industry is maintaining a large enough consignment pool to meet demand for the fall season. “It will be interesting to see whether or not those sales will happen over the summer months when traditionally auction houses are shut down, or if they’re going to wait until the fall. I would expect to see that traditional busy season from September 1 through Christmas pulled forward.”
Weisberg noted that global industry leaders have felt the digital shift. Recalling a recent conversation with CEO of Paris auction house Tajan, Rodica Stewart told him that “‘in the course of ten days we went from being a brick and mortar auction house to being an online auction house.’ And that is the change that you’re seeing across this industry.”
Invaluable’s report coincides with a shift that is affecting even the biggest auction houses. Last week, Sotheby’s revealed a new remote sale evening sale format for its June marquee auctions centered around a live televised auctioneer, with remote bidding streamed across all major sale headquarters. And on Sunday, Christie’s CEO Guillaume Cerutti released an image of the auction house’s Paris salesroom during a decorative arts auction that captures a sparse landscape of social distanced bidders and masked staffers in the first visual of a post-coronavirus auction.
Previously, surveys had suggested a lagging digital art market. According to the 2019 UBS Art Basel Art Market Report, online art sales are proportionally lower in comparison to other industries, even if art e-commerce increased over the last year. (The 2019 Hiscox Online Art Trade Report also confirmed the trend.) The UBS report noted that the role of the third-party online sales platform is growing in importance to the industry, especially among second-tier auction houses in need of access to a wider base of new buyers and back-end software for online transactions.
According to Weisberg, the shift online could have long-lasting impact on the way auction houses do business. “We’ve seen mass growth in our space being fueled by younger people being exposed to the auction world who are accustomed to buying the pieces that they want digitally,” he said. “Auction houses started recognizing the younger demographic, the future buyers choosing to engage with them digitally.”
And now, it’s unclear what the role of a physical salesroom will even be going forward. “Unfortunately,” he said, “the dynamic of the floor bidder is going to be gone for some time—and perhaps permanently.”
