State of the Market: Art Basel Miami, Millennial Collectors, and the Impacts of COVID-19
Days after Art Basel announced the cancellation of the Miami Beach fair this December, the company released a new report examining the impacts of the COVID-19 pandemic on the art market. The results were not encouraging for art enthusiasts but offered a glance into a post-pandemic world based on online sales and virtual exhibitions.
Art Basel and UBS released the market analysis report in the wake of the latest art fair cancellation. Art Basel Miami Beach, formerly slated for December 3 – 6, typically brings in tens of thousands of visitors. A 2014 analysis from The New York Times pointed to the revenue that the fair typically brings to the region, a figure that crosses USD 13 million per year.
The Miami Beach Convention Center, where the fair is usually held, has been converted into a reserve field hospital and testing site. Rising coronavirus case numbers in Miami-Dade County have also contributed to the cancellation. The Miami Beach mayor agrees with the decision, citing the difficulty in planning cultural events during a public health crisis. “I have always believed that we’re not going to get our economy back — including our cultural economy — until we get the virus under control… [until then,] members of the public won’t have confidence in group events and traveling.”
Participating galleries will not be charged booth fees, but have the option to offer works in Art Basel’s Online Viewing Rooms. The digital exhibition concept, which experienced mild initial success at the start of the pandemic, was designed to balance the financial losses that Art Basel has suffered this year.
Art Basel’s recent analysis emphasizes the financial woes now plaguing the market after months of shutdowns and cancellations. Prepared by Arts Economics’ Dr. Clare McAndrew, the report surveyed over 350 gallerists and collectors in the US, the UK, and Hong Kong. Among the findings were ongoing layoffs and furloughs, declining sales in small galleries, and an accelerated movement toward online purchases. New buyers have proved essential in supporting the market through the pandemic, boosting the share of total online sales from 10% in 2019 to 37% in the first half of 2020.
High net worth collectors have remained active in recent months with a growing proportion of millennial buyers. In fact, millennials and Gen X collectors appear to be spending more than older generations: 97% of millennial collectors continued buying through the pandemic, compared to around 66% of baby boomers. Millennials are also the most optimistic about the future of art buying, hoping for a comeback in 2021.
These statistics correspond to the growing market presence of millennials. Young collectors surveyed for the report showed no signs of slowing their buying habits, either. Their optimism can be partially traced to a shift in mindset when it comes to collecting. Millennials are much more likely to see art collection as an investment strategy, one that can be approached from the comfort of the home.
Revenue from online auction sales, driven by millennial participation, has spiked in recent years as a result. Invaluable’s 2019 Market Trends Report attributed this to a growing comfort with online sales and auction bidding platforms. 2020 has put this comfort to the test. Projections for the next several months, though rather bleak, count on the sustainability of the online marketplace.
Art Basel’s Noah Horowitz commented on the recent market assessment: “Throughout it all, what is equally clear from the results of the report is the shared sense of engagement, purpose, and community that continues to define so much of the art market and remains vitally important to our future.” Those interested in learning more can find the full Art Basel and UBS market analysis here.
