28 September, 2023
Amidst a climate of economic instability and high inflation, it is unsurprising to see that the habits of many, including art collectors, have changed this year. But, to what extent have they really changed and what can this tell us about what to expect in 2024? We took a deep dive into Artsy’s latest ‘Art Collector Insights 2023’ report, based on their annual survey of more than 1,200 respondents, to find out more.
When it comes to reasons for buying art, most of the people surveyed (64%) answered that they were looking to build their own collections, although this was almost tied with the desire to decorate their homes or other spaces (62%). Other key reasons were the desire to support artists (52%) and seek inspiration (50%). This is fairly consistent with what we would expect to see. However, one difference, which can be attributed to the current climate, is that 38% responded that they purchase art as an investment, which represents a six-point rise from the previous year. Seeing as art has been prominently hailed as a safe haven asset in times of economic volatility, this seems quite logical.
Indeed, in comparison to the S&P 500, art has consistently demonstrated its strong performance in the context of economic turmoil, such as the 2008 downturn, or in times of unprecedented crisis, such as the COVID-19 pandemic and the high inflation we have seen since last year. As an example, in 2021, global art sales reached $65.1 billion (+29%), surpassing pre-pandemic levels of 2019. Also, in the first quarter of 2022, auction sales reached $7.49 billion, the fifth most prosperous period ever recorded (Art Basel & UBS Report 2022). Overall, the art market has outperformed the S&P 500 by 240% since 1986 (Live Art), as shown in the graph below.
In terms of mediums and genres, the majority of respondents said that they purchase paintings (94%), followed by sculptures and ceramics (57%) and prints and multiples (56%). As such, logically, their preferred genres are associated with painting, with the top three being abstract art, expressive figurative works and realist figurative works.
Unsurprisingly, in view of inflation, all three major auction houses – Sotheby’s, Christie’s and Phillips – saw declines in sales in the first half of 2023. There already seemed to be an expression of concern over inflation in Artsy’s 2022 report, with 37% of respondents worried that it would impact their budgets the following year. However, despite the drop in sales reported by the three auction houses, 73% of respondents to the 2023 survey claimed that they bought “the same amount or more of art by volume over the last 12 months than they did in the previous 12 months”. In fact, Artsy’s findings also show a marginal increase in the average price points of artworks purchased, which could be linked to inflationary price increases. Additionally, of the collectors who have been buying the most art, the survey shows that they are also spending more at a higher rate. As an example, 19% of respondents who purchased artwork over the last 12 months expect to spend at least $250,000 on art in 2023, fairly consistent with the results from last year’s survey.
From Artsy’s survey, we are also delighted to see that digital tools continue to play an important role since the pandemic. 80% of respondents had purchased art online in the last 12 months, representing a four-point rise since last year. It would appear that seeing art before purchase no longer plays as important a role, as 95% of online art buyers have done this. In addition to buying art online, collectors are increasingly depending on the Internet to discover new artists and art, especially when it comes to Instagram (50% of respondents say they used Instagram for this purpose). That said, one of the main challenges facing online buyers is a lack of price transparency (expressed by 58% of respondents) as well as insufficient information about the work (51%). For online platforms to reach a maximal audience, they should pay special attention to these two factors.
Finally, a significant change is the increase in art purchases from young collectors, so-called next-gen collectors. In general, this generation has been purchasing art at a stable, steadily increasing rate since last year: 86% of respondents aged 18 to 36 purchased the same or more art as last year (for older collectors, the rate was 74%). That said, older collectors purchased art at a higher volume. Unsurprisingly, in terms of buyer habits, younger collectors are more likely to purchase art online and use social media to not only discover but also buy art. For instance, 94% of such collectors responded that they view Instagram as an important tool for discovering art. In terms of types of art, 64% of young collectors seem to prefer including emerging artists in their collections, compared to only 43% of other generations. Astonishingly, only 11% of young collectors believe that it’s important to collect blue-chip art, compared to 23% of older collectors.
To conclude, based on the results of Artsy’s latest Art Collector Insights report, we predict that trends seen in 2023 will continue in 2024. Specifically, those collectors who bought the same or more art over the last 12 months are expected to continue to do so in the next 12 months. When it comes to younger collectors, we expect them to become more and more dominant in the art market, continuing to promote emerging artists, while also boosting digital sales. As we are talking about a tech-savvy collector base, we predict a rise in innovative, untraditional ways of collecting art, such as through virtual galleries or the metaverse, and ways of investing in art, such as fractional ownership. We’ll report back next year!
Arun Kakar, ‘Art Collector Insights 2023’, Artsy
Art Basel & UBS Report, 2022