Yesterday, Amazon launched its Art Marketplace, and I’m really excited. I expect it will vastly expand the art marketplace by inviting the casual shopper. But for brokers, they will need to completely change their business model to respond to this new opportunity.
Is there a casual shopper for art? Absolutely — this is why most malls in metropolitan centers have galleries. I myself was captivated by a Warhol in such a gallery when I was 19 or 20 and ended up buying it, before I even had a car. I started off idly admiring it, came back a couple times over the following days or weeks, and went ahead and got it. If it had not been so accessible, I not only would not have bought it, I would probably not even have paid attention to the art scene at all in my subsequent years.
Up until now, there has been a daunting set of obstacles to online art shopping that is discouraging to all but the most determined customer. There hasn’t been an obvious, stable art exchange online, and it’s hard to figure out what to Google when you’re shopping for fine art (“broker” isn’t the first word that comes to mind for most people). Typically the existing services involve making private inquiries with the dealer just to find out “how many zeroes we’re talking.” These sites are usually badly designed, and there’s often no obvious way to buy the damn thing.
I expect that by making shopping for art as easy as shopping for anything else, and by throwing the might of the Amazon brand behind the effort, Amazon will significantly expand the size of the art market. It removes the aforementioned barriers to entry. Yes, there will be a lot of time-wasting unqualified leads, but at least they will be doing it on the web site instead of the dealer’s phone.
But what of the dealers?
It’s interesting that Amazon Art is strictly a marketplace for established dealers – about 50 at launch. I think this is the right approach, but I expect that won’t last long, if the main Amazon Marketplace is any example. Dealers will get the mighty twin advantages of Amazon’s exposure and e-commerce infrastructure, and the increased sales will make them more comfortable selling to the hoi polloi. Soon, though, individuals like me will be looking to sell into the same marketplace. Will Amazon make it easy for me to compete with dealers? If so, why would anyone use a dealer, when their perceived value was in providing access to potential buyers?
The challenge for dealers will be to clarify what services they can still provide to justify giving them their traditional cut – or any cut at all. Certainly I think even (especially!) Amazon buyers will be more confident buying from established dealers than from individuals; this will translate directly to an increase in a reasonable selling price. Dealers’ experience with actually handling the art (packing and shipping, and even documentation) will also be helpful to the seller and reassuring to the buyer. (Of course, getting the artwork to the dealer may present additional challenges if they’re not local.) The dealer may be able to provide valuable assistance by coordinating appraisals, photography and restoration services.
How will these dealers communicate these value-adds to potential sellers? Hopefully, Amazon will provide a way for would-be individual sellers to make that decision and find the right dealer. In any case, dealers need to immediately rethink their business model.
If I were an art broker
In the face of this new development, the art dealer has a choice. Try to compete for customers against Amazon and go the way of the independent bookseller, or pivot the entire business model to attract sellers instead of buyers.
If I were a broker or a dealer, I would drop everything and start thinking about how to get individual sellers to go through me instead of going through Amazon directly. I would make sure I have a stable of available appraisers, framers, researchers, and conservators. I would make sure I have a great packing/shipping solution in place and make sure all of this is demonstrable to potential customers. Sales figures, customer success stories, testimonials, social media – all of it needs to be ready to go when needed.
My sales staff needs to immediately shift focus. Instead of selling to traditional customers, they need to rope in individual sellers. Certainly, the traditional model isn’t going to evaporate for up to a generation. But the savvy dealer will maximize the opportunity of an expanded marketplace and leave the traditional models to someone else who really wants to struggle.