Confidence in buying art online is soaring, with virtual art platforms rapidly establishing meaningful foundations, according to new research released today by specialist insurer Hiscox.
The Hiscox Online Art Trade Report 2015 found that the value of the online art market has risen from $1.57 billion in 2013 to an estimated $2.64 billion in 2014. Based on these figures, online art buying accounts for 4.8%of the estimated $55.2 billion value of the global art market. On the same growth trajectory, the value of the online art market could reach $6.3 billion in 2019.
Robert Read, head of Fine Art at Hiscox, explained: “The rise in online art buying is even greater than we anticipated. The speed and confidence with which new and established collectors are adapting signals a new era as buying art becomes an omni-channel experience. Physical gallery space and auction houses can no longer act in isolation; online channels and social media have an important part to play and, when combined, prove to be attractive. This is good news for sellers as well as collectors.”
Art buying patterns and motives are changing. Almost half of this year’s respondents (49%) said they had bought art online in the last 12 months, up from 38% last year. This indicates that further progress has been made towards mainstream adoption. Particularly popular among new collectors, the online art market continues to make collecting accessible and attainable to a broader demographic – good news for the whole industry.
The majority of online art transactions still take place at a lower price point, with 84% of purchases made at below £10,000. Some 41% of those surveyed said their average price paid was less than £1,000. Interestingly though, investment return is also being cited by many as a growing motivation for purchase, with as many as 63% driven to purchase by a piece’s potential return on investment.
Art is increasingly seen as an attractive and highly tradable asset class and such a trading mentality may lead to online marketplaces succeeding as pure transactional platforms. This could shake up what is traditionally a relationship-based industry. These days, those relationships are moving online: the survey found that social media affects art buying decisions, with 24% of respondents saying posts by museums, galleries and artist studios had a direct influence on their art buying decisions.
Read added: “There are too many players in the online art market, as one would expect at this stage of the development cycle, and it is still impossible to say who the winners will be. We will have to wait for a couple more years of mergers, acquisitions, thrills and spills to see who emerges on top, but what’s clear already is that those with a trusted brand, a ‘real world’ presence and an online business have a distinct advantage.”