Over the last decade, contemporary art as an investment has seen a number of challenges along with a growing engagement. Although the modern art market as a whole has decreased, the online market is increasing, offering an opportunity for both new and experienced investors to explore a far larger range of works compared to the offline market.
Although art does not have the same return as traditional stocks, contemporary art appeals to many collectors for reasons that transcend assets. Many choose art investments on an emotional level, even while considering the investment value over time.
To understand the way that online sales are driving investments in the modern art market, it helps to first understand the rise of online art investment.
According to The Online Art Collector Report 2019 conducted by Artsy, 64% of art collectors stated that they had bought art online. Within that group, 21% stated that online art makes up 75% of their annual art spend, while 15.3% stated that they spent between 50% and 74% of their annual budget buying art online.
There are a few factors driving contemporary art sales online. Some of the biggest reasons for the rise in online purchases include a simplified purchase process compared to traditional galleries and auctions, with new collectors especially finding online sales easier. Lower pricing also plays a part. Typical overhead costs at traditional galleries can quickly trickle down to buyers. Art broker costs can often end up increasing total prices by 25% or more. Storage costs, transport costs, insurance, and numerous other costs also come into play. Then there are hidden costs, such as liquidity. In other cases, economic challenges can result in forced sales that see art being sold below its value.
The speed and accessibility of buying online is another factor. The ability to view artist profiles and learn more about artists is yet another factor drawing collectors. Compared to galleries, which are only able to showcase a limited number of artworks, online galleries are far more diverse, giving collectors a greater variety of pieces to choose from.
Although some investors may prefer to stick to stock, there is no doubt that art offers an exciting, rewarding investment that results not only in return but also in enjoyment for those with a passion for art.
If you are looking for a worthwhile investment, online contemporary art is sure to be a rewarding choice.