A new vision: the effects of the pandemic on the art world

The words that characterise our new lexicon:  ‘unpredictable’, ‘uncertainty’ ‘adaptation’ and ‘change’ can all readily be applied to the art world.  What we saw in 2020 was huge disruption and profound change for everyone.  There has been commentary and analysis on many sectors and industries but the impact on the art market is perhaps less apparent at first glance.

As was the case for many industries the art world was forced to adapt by circumstances. The enforced lockdown measures meant that the auction houses had to move their sales online.  Some auctions were cancelled or postponed but technology enabled many to go ahead as virtual events.  Fortunately, the big auction houses had already invested in on-line technology and were already set up for taking online bids at ‘real-life’ auctions. 

There is an element of theatre around the auction sales, particularly for Contemporary and Modern art.  The first live-streamed auction from Sotheby’s proved how adaptive the auction houses had become.  The excitement of the auction room was not diminished as thousands of people logged on to watch the big sales from Christie’s and Sotheby’s. 

Online-only auctions (which are open for bids for a specified period) became the modus operandi for selling smaller items.  These proved to be a success with record growth in online sales for all the auction houses.  It was the Contemporary sales, particularly that returned the best results, largely as a result of luring younger buyers.  With a global economy grinding to a halt and the absence of spending on luxury travel and entertainment, many younger, first-time buyers with a large disposable income saw an opportunity to start investing in art. 

Reported sale prices were largely in line with estimates but overall auction sales were down approximately 50% compared with real-life auctions.

The art market, however, is estimated to have fallen by almost a third overall in 2020. The biggest change perhaps comes from the lack of sales from art fairs.  The key to the success of the art fair model is bringing galleries from around the globe together in one curated space, with dealers and collectors flying in from all corners.  With no international travel and social distancing restrictions in place, fairs from Hong Kong, London, New York and Basel were all cancelled.

Again, adaptation was key and the speed at which the fairs moved was remarkable.   The online viewing room became ‘a thing’ in the art world.  Whilst this was an innovative model that served a purpose, it is not conducive to high-end art sales.

Seeing works in the flesh is one of the pleasures of art. Standing in front of a painting and sensing the thoughts, feelings and emotions of the artist is an important part of the process.  Art is an emotional purchase and unlike ‘luxury items’, it elicits a passionate response which can’t quite be replicated on a flat, two-dimensional screen.  Anyone who has ever stood in front of a Rothko, Turner, or grasped the scale of Monet’s Waterlilies, for example, will be able to attest to the sensory response that is evoked.  Buying a piece to hang in the drawing room requires the same visceral reaction.   Moving the art world to an online retail space is, therefore, less than ideal.

The cancellation of art fairs in 2020 accounted for a huge drop in sales for commercial galleries.  Not least as many of the galleries had to close completely during lockdown, further impacting sales.  Whilst the online viewing room gave everyone a window into the art world, it is much harder for galleries to sell works without the buyers’ excitement and enthusiasm of seeing the work in situ.

So, where does this leave the art world in 2021? 

For now, some fairs are still planning to go ahead in 2021 and have just shifted the dates back to allow more time for the virus to abate.  It is, however, unlikely that art fairs will come back in their old form anytime soon. Whilst there is optimism in the planning, it is likely that 2021 fairs will have to adapt again and take place as virtual events.

Despite the vaccine, it’s hard to imagine that international travel will resume quickly and there will be scant justification for jumping on a plane to New York or Hong Kong to see a few paintings. 

The auction houses will face the same problems with buyers unable to travel to London and New York for the big-ticket sales, it is likely that these sales will continue to take place as live-streamed events and online auctions will continue.  During the lockdown, auction houses are offering virtual viewings.  It’s not quite the same as seeing the work in real life but for anyone looking to buy, it at least offers a more personal approach, enabling questions to be answered.

It seems probable that the art world will have to continue to adapt through 2021.  Once social distancing measures are relaxed and galleries can re-open, we may find more personalised events and appointment systems in place.  It may be that galleries have to find innovative ways of collaborating and working together.  This already, in some part, takes place in terms of “Art Weeks” and fringe fairs taking place around the same time as the big fairs like Frieze.

Despite the current difficulty of seeing art in the flesh, there are still likely to be buyers around.  There will always be wall spaces to fill and occasions to mark with an important painting. There is, however, a distinction between accumulating and collecting.  The latter assumes an understanding, knowledge and love of art.  The collector knows what they want and is likely to bide their time and wait for the art market to resume some ‘normality’ before assuming the right moment to buy.   The ‘accumulator’ on the other hand may see an opportunity to buy now, possibly at good prices, from anyone keen to sell.

The problems are acute for the fair organisers and the galleries but equally so for the auction houses.  Having established the live online auctions as a success, they now need to find the right works to sell. 

Sellers are less likely come forward in a pandemic; their hesitancy stemming from uncertainty and a lack of buoyancy in the art market.  Of course, there will always be sellers ready to off-load works for whatever reason.  Some may be forced to sell and it is likely that what we will see are distressed sales. (British Airways have already auctioned some of their corporate collection via Sotheby’s.) So, there will be opportunities for both the auction houses and buyers alike to keep the art market going through 2021.

Planning the year ahead, however, is increasingly challenging and if the art world has learned anything from 2020 it is that adaptation is key. Change may have been necessary and long overdue, but despite the quick adoption of technology and virtual events, art is not ideally suited to a virtual world and will perhaps be one of the few industries that doesn’t become entirely digital.  The appetite for seeing art in the flesh will probably not be diminished.  It has endured over centuries and we can hopefully rely on the fact that, post-pandemic, people will want to go out and both see and buy art again.

Please also see our blog on the future of art fairs.