Art collectors have consistently held a pivotal position in the historical trajectory of art and aesthetic preferences, serving as instrumental figures within the art market. Their influence extends to shaping forthcoming market trends. Nevertheless, contemporary art collectors diverge from their historical counterparts, with evolving profiles aligning with the advent of digital art. The rise of digital art is concurrently giving rise to novel collector archetypes. Artsper prompts contemplation on the identity of collectors in 2024, considering the transformative impact of digital art on this demographic.
Generation Z: the future players of the art market
A new generation of collectors is developing and occupying an important place on the art market: young art collectors, also known as Generation Z, occupying the age bracket up to 25 years old. They are also interested in developing collections.
Generation Z, the emerging force in the art market, is redefining collecting trends. These young collectors are driving a huge digital shift, propelling the online art market towards an expected $17.76 billion by 2030.
Using technology and social media, Generation Z view art as an extension of personal branding. Concentrated in the US, Europe, and particularly Asia, these affluent young collectors, are becoming key clients for global auction houses. In the first half of 2023, high-net-worth millennials in Asia spent a median of $59,785 on art, with Gen Zers close behind at $56,000. The Art Basel & UBS Survey of 2023 indicates a shifting landscape where the younger generation is set to inherit substantial wealth (predicted to range up to $70 trillion by 2030).
How do Gen Z art investors differ from the last generation?
Young art buyers are more driven by investment goals and gravitate towards emerging artists, as well as socially conscious art, such as indigenous artists. Also, their interest lies more in understanding the artist's motivations, rather than focusing on art history like the previous generations. In 2023, millennials favored sculptures, installations, photography, and film. Gen Z collectors topped spending in digital art and prints. Younger buyers value emerging artists in their collection (64%), showing a shift in preferences compared to the older generation. Interestingly, blue-chip artists, well-known in the industry, are less prioritized by the younger collectors (11%) than by their older counterparts (23%).
The Art Investors
Art has become an asset in which collectors invest to diversify their financial portfolio. Works of art function like an investment. The allure of art as an investment lies in its stability, as it retains its value over time, resilient to fluctuations experienced by stocks and other assets. In 2023, amidst financial turmoil, high inflation, and global challenges, 77% of High Net Worth (HNW) collectors express optimism for the art market's performance over the next six months, slightly surpassing confidence in the stock market (74%).
Current art trends include: mainland China reported the highest median expenditure in the first half of 2023, at $241,000, showing a strong return to spending post-lockdown. The majority of spending in 2023 was on paintings (58%), with works on paper being the second-largest component (13%). By mid-2023, surprisingly sales of art-related NFTs had fallen to their lowest level since January 2021. As we navigate through 2024, we anticipate a continued refinement in the ultra-contemporary art category. Abstract art takes precedence over representational or traditional paintings, owing to its value of presenting fresh meanings and depths.
In 2024, attention shifts to auction houses as Christie's and Sotheby's experienced a sales drop exceeding 10% in 2023, while Phillips faces potential financial challenges.
Graphic from the The Art Basel & UBS Art Market Report 2023
Art advisors share insights on 2024 predictions and highlight key motives guiding their recommendations for the art market this year:
Leo Xu, senior director for David Zwirner, Hong Kong:
In 2024, there will be greater international visibility for Asian artists, emphasizing Asia's creative influence on global culture, and a repositioning of the Chinese market on the global art market.
Allan Schwartzman, art adviser:
Anticipates reduced urgency among collectors, foresees market volatility for emerging artists, calls for a sustainable secondary market to accommodate the resale for contemporary art.
Alex Glauber, president of the Association of Professional Art Advisors:
Is optimistic after the 2023 correction, as the Federal Reserve will cut rates, which will boost collectors demand, expecting discretionary selling.
Lawrence Van Hagen, art adviser and curator :
Expects a shift of galleries towards selectivity and regionalism. Galleries might participate in less fairs, as costs rise and collectors will target local art scenes.
Charles Stewart, Sotheby's CEO:
In 2024, there will be a continued price separation in art quality, rising demand for underrepresented and historically marginalized artists, with women artists gaining market prominence. Since 2018, sales of female contemporary artists at over $1 million have more than doubled led by Joan Mitchell and Yayoi Kusama.
The digital investors
The global online market gathers individuals from various parts of the world in the trading of artworks and collectibles. Based on a study conducted by Statista, prior to the public health measures implemented during the COVID-19 pandemic that led to a substantial increase in digital sales, about ten percent of the global art market’s value was attributed to online transactions. Despite a decline in the trade of online art and antiques in 2022, the value of those transactions still remain significantly higher than in pre-pandemic years, totalling around 11 billion US. dollars in 2023. The traditional art world’s investment in online sales channels during the pandemic has paid off: a report made by Hiscox highlights that online auctions, for instance, are the second most popular choice for art electronic purchases, while online marketplaces remain the most popular destination, servicing 59% of the art buyers and investors present on the internet. Additionally, there has been an increase in the proportion of art buyers with no preference between purchasing artworks offline versus online, from 37% in 2022 to 42% in 2023.
Amongst those that buy artworks online, proportion of people buying on online-only auctions, online marketplaces, bricks-and-clicks, online-auction aggregators and online search for the arts and collectibles market, 2019-2023. Graph from Hiscox Online Trade Report (2023), P13, online.
With the global art market transforming comes a new wave of customers, and by that investors. The study of Hiscox reports that more and more millennials declare buying artworks as much online as they do offline, leading towards a tendency to view online purchasing as normal. As surprising as it may seem, it is also the case for older generations, like gen X and boomers. Easily accessible information, price transparency and quality are often cited as the main advantages of transactioning online. A whooping third of young buyers and almost 40% of new art buyers said they bought their first ever artwork via the internet, which suggests that this market plays a crucial role in drawing in new generations of collectors. While younger buyers get around more, most buyers irrespective of age are increasingly loyal to their preferred marketplaces.
The top factors when buying online, 2022-2023. Graph from Hiscox Online Trade Report (2023), P14, online.
Millennials are also more willing to take risks than their senior counterparts when investing in art commodities, and accordingly, use social media to both buy art and supplement their research. In 2023, 29% of art buyers said they had bought art directly through Instagram. Among buyers under 35 years old, 42% said they had bought art through Instagram in the past 12 months. Consequently, Instagram appears as a critical marketing tool for artists and galleries to cultivate a relationship of interest and confidence with the younger generations. The platform became a reference to discover, browse, and follow the art world.
Researchers behind the latest conjoint study of Art Basel and UBS also suggest that there are some regional variations in terms of offline versus online purchasing in the art market: notably, a higher than average share of collectors in Taiwan, Brazil and Germany preferred to access sales from dealers online, while Japan and Mainland China presented the lowest proportions in 2023.
High-Net-Worth (HNW) collector preferences for purchasing from a dealer, 2023. Graph from The Art Basel and UBS (2023), P13, online.
Depending on the needs, an art advisor may have to play different roles, from a curator that selects pieces to fit the collector’s taste, to an auction expert that helps finding good investment opportunities or rarer artworks, offline and online. The expert may be able to tell when to purchase and sell to maximize profit, can provide practical advice in terms of framing, lighting and displaying the artworks and helps with all the aspects of the transaction, from transport and customs to insurance.
Although art advisors can sometimes be instrumental in the emergence of an artist, overall, the longevity of their career will depend on the extent of their network. Strengthening tight relationships with galleries can be beneficial for them, especially in an environment where speculation on the price of certain artworks is stronger. For instance, Paris-based galerie Balice Hertling represents and defends artist Xinyi Cheng, whose paintings used to be sold for around €20,000. In 2022, one of Cheng’s creations was traded for 25 times that price at an auction event in Hong-Kong, thereby attracting the interest of art advisors until one can no longer count. On the flip side, galleries can maintain proximity with art advisors by giving them exclusive access to some of their most prized artworks, or by organizing more intimate events, private shows centered on the work of a newly rising and promising artist. Building a fair and exclusive relationship on both sides of the transaction increases the chances of fostering loyalty, which can prove beneficial in challenging times.
Generally, both galleries and art advisors have even more reasons to collaborate if they happen to share an expertise in the same domain. Michael N. Altman, for instance, is an accomplished art dealer that specializes in the placement of artworks belonging to the Hudson River School, as well as Impressionist, Post-Impressionist and post-war. Italian Marco Bertoli has over 30 years of experience in the industry, and caters to those that have a weakness for 17th to 19th century European art. For Asian art, Xiaoming Zhang is one of the references.
The increase in the number of art advisors can be correlated with the development of technology, as the surge of individuals experiencing the art world through their screens has generated increased demand, especially during and after the COVID-19 pandemic. It is now more common for an art advisor and his clients to discover an artist on social media or marketplaces. Artsper Art Advisory Service (AAA) represents an ideal solution for the galleries, amongst others, to reach those online collectors. The service is based on Artsper’s unique expertise of the online art market and contains a rich base of customers that are ready to start or expand their collection.