2020 was a hugely challenging year for businesses operating in the art market. For a market that has become so dependent on events, travel, and discretionary purchases, a drop in sales of around 22% was no surprise to anyone. However, some businesses did manage to keep things going despite the health crisis. The contemporary and modern art galleries stand out in particular, making a massive shift to online sales during the second half of the year to maintain trading. According to the fifth edition of The Art Basel and UBS Global Art Market Report, online sales reached a record high of $12.4 billion, doubling in value on the previous year and accounting for a record share of 25% of the market’s value. Losses were bigger among more prominent businesses, despite shifting to digital because they are commonly reliant on art fairs.
Luckily, the world in 2021 opened up again, giving art lovers and dealers every reason to be optimistic about the art market’s future. It has already overcome the challenges of an absent collector with online viewing rooms and online auctions. Throughout 2021, the art auction market showed remarkable dynamism in online sales, including the sensational entrance of NFTs into the high-end market. With the support of Christie’s, American digital artist Mike Winkelmann known as Beeple sold an NFT of his work “Everydays – First 5000 Days for a record-breaking sum of $69.3 million (about 58 million Euros) in an online auction held in March 2021. Before this headline-making event, Beeple was relatively unknown among the mainstream art players.
Besides adapting to the needs of online buyers, the art market seems to have managed to regain the trust of the present buyers this year. All the major art fairs this fall, including Art Basel, Frieze London, and FIAC, have shown a strong attendance amid the continued challenges of the COVID-19 pandemic, with some booths selling out within hours of opening. After almost two years of not making regular, in-person contact, galleries and collectors couldn’t have hoped for a better start of the fall programming of art fairs. The NFTs mentioned above even made their debut at Art Basel.
Things indeed look promising as we reflect on 2021 and think about 2022’s trajectory. The insights from the Art Basel and UBS mid-year review 2021, based on responses from more than 700 dealers operating across 54 regions and a survey of 500 high-net-worth collectors, testify to confidence restored in the art market. More than half of art dealers reported an increase in sales in the first half of 2021 versus the same period in 2020. Dealers in Asia reported the most significant improvement in sales, with an average increase of 18%. The most challenging environment was in Europe, where dealers reported an average decline of 7%. Online channels accounted for 33% of all dealers’ sales, or 37%, including art fair Online Viewing Rooms, more than double their share in 2019. Online sales are now also an integral part of auction house strategies. According to Artprice, Christie’s, Sotheby’s, and Phillips conducted 133 online sessions out of 258 fine art sessions in total at the start of the year. However, these transactions generated only a tenth (9.3%) of the operators’ turnover because auction houses mainly use this channel for entry-level and mid-range lots.
The Art Basel and UBS mid-year review also revealed that collectors remained active. The median expenditure on art and antiques jumped by 42% on average in the first half of 2021. Millennial collectors were ready to spend the most money, at $378,000, more than three times the level of Gen X and Boomers.
The performance of fine art auctions seems to be particularly reassuring given the health crisis. According to Artprice, fine art auctions generated $6.9 billion in the first half of 2021, up 3% compared to the same period in 2019. Contemporary Art, in particular, made a notable performance in the first semester of 2021, up 50% versus the same period in 2019. It now accounts for 23% of global fine art auction turnover compared with just 3% twenty years ago. Jean-Michel Basquiat alone accounted for 4.3% of the global art auction market in the first half of 2021, having generated over $300 million.
The Artprice list of top 10 artists on the global auction market in the first half of 2021 include:
1. Pablo PICASSO: $352,169,000
2. Jean-Michel BASQUIAT: $303,537,000
3. Andy WARHOL: $ 149,982,000
4. Claude MONET: $131,638,000
5. BANKSY: $123,328,000
6. ZAO Wou-Ki: $114,518,000
7. Gerhard RICHTER: $97,920,000
8. Sandro BOTTICELLI: $94,206,000
9. Yoshitomo NARA: $85,937,000
10. ZHANG Daqian: $82,295,000
As seen, street artist Banksy is the most lucrative living artist in the world at the moment. In the last five years, Banksy’s auction turnover has been growing exponentially: $3 million in 2016, $7 million in 2017, $16 million in 2018, $29 million in 2019, $67 million in 2020, and $123 million in the first half of 2021. In March 2021, his canvas Game Changer (2020) set a new auction record at $23.2 million.
Among the top 5 artists born after 1980, Artprice listed Matthew WONG, Avery SINGER, Salman TOOR, Ayako ROKKAKU, and Amoako BOAFO.
The unprecedented pandemic gave contemporary art a test the likes of which it had never had: It did highlight some vulnerability in this previously bullet-proof asset class. However, the bounce-back to full health as wise investors returned to investing in art, alongside the explosion of digital art, show the incredible resilience of the art market. As we set out into 2022, the world has changed, but so has the art market, proving its ability to adapt and surge on.