What's the best place to sell art? (Part 2 - The Trends)

Following on from 2012 Poll Results: What's the best place to sell art? (Part 1), TRENDS in the popularity of different places to sell art forms the subject matter of the second part of my feedback relating to my Annual Making A Mark Survey about the best place to sell art.

Now - the problem with this is that I've changed the survey every year and so the data between years is not strictly speaking comparable.  It was also not helped by mixing up PLACES where art was sold with WAYS in which art was promoted.

I've attempted to make the survey data more comparable by grouping places where people sell their art in three main groups.  These are

Part 2 - Today

1. The Best Place to Sell Art - through the Artist's own efforts
2. The Best Place to Sell Art - 3rd parties / face to face /on commission

Part 2 - Tomorrow

1. The Best Place to Sell Art - Temporary Venues - Art Fairs to Street Markets
2. The Best Place to Sell Art - eBay vs Etsy
3. The Best Place to Sell Art - Other Online Galleries

Economic Context

One thing we need to bear in mind when looking at the trends is that the last five years have been the equivalent of economic topsy turvy.

It's worth remembering what the macro-economic climate was like when looking at the charts - so I've attempted to summarise this below.  Bear in mind this is a gross over-simplification.

Years	Financial Context	Impact on Art
2008	Global Financial Crisis Part 1: housing bubble burst / subprime mortgage crisis / homes repossessed / property values declined the worst international economic crisis since the Great Depression of 1930s banks hit hard - institutional bail-outs credit crunch - businesses fail demand reduces leading to... recession	People stop buying art. Galleries with precarious finances suddenly close Banks stop/reduce sponsoring art events / exhibitions Virtually all artists affected - except those selling to very wealthy clients Rocky time for auction houses begins
2009	Getting back on track A period of retrenchment - looking to minimise risks Credit crunch continues people start being mindful of their liquidity	Galleries without working capital reserves go under - artists lose places to sell art Artists selling to wealthier art collectors and/or those with specialist collecting interests (eg wildlife) less affected by recession Artists in the middle ground on price badly affected - start painting smaller works
2010	Recovery Household spending recovers The illusion of "normality" is prevalent	People begin buying art again  Volume of sales down - but revenue streams hold steady for those selling higher priced art Artists find new ways of selling art Artists raise prices to: avoid looking cheap to wealthier art collectors recoup lost volume in sales
2011	Global Financial Crisis Part 1: The Warnings Analysts began to realise that the worst was yet to come and that the recovery period was going to be very long. Prospect of Double Dip Recession now seems real  Secondary effects from some very weird weather which affected economic activity and priorities for spend	People start to become careful again and the art economy is wiser second time around Galleries have stage payment systems in place this time around to enable people to feel safe when making art purchases  Artists develop new ways of selling art eg small groups organise their own exhibitions Household spending adopts new pattern. eg proper spending at Christmas but no frivolous spending during the year  areas where freak weather diverts household spending hard hit re "extras" eg art
2012	Global Financial Crisis Part 1 - End Game European sovereign-debt crisis - whole countries now at risk (eg Ireland, Spain, Greece, Italy). Double Dip Recession occurs in a number of countries eg UK back in recession Jan-June 2012 USA housing market still dodgy	Middle income collectors continue to be careful - they stop buying art (again) and/or reduce volume of purchases buy cheaper art / prints in order to have new pictures without unnecessary financial risks

Now for the best places to buy art - and how they did over this five year period!

The Best Place to sell art - through the Artist's own efforts

What I tried to do this year was pull all the different ways in which artists try to sell art without the help of third parties under one heading "direct from studio" + "open studios".

The worse the state of the economy the more likely the artist will be dependent on their own efforts to sell direct from their studio.  "Artist's own efforts" are directly and inversely correlated to the state of the economy and demand in the marketplace generally.

• In 2008, as the economic crisis bit, the first thing that happened was that it became more difficult to sell art everywhere.  
• In 2009 Galleries closed and people stopped spending money on art because life became very uncertain.  Artists's own efforts became more important as and other sources of income dried up or became too expensive to pursue
• As the illusory recovery arrived in late 2009/2010, artists own efforts became less important again 
• In 2011/12 as the financial crisis continued and the double dip recession arrived artists' own efforts again became an important source of sales.  30% of artists said this was their main source of sales and 27% said this was the most profitable place to sell art.

The reason that artists own efforts to sell direct from the studio is so important is that this venue is also the most profitable.  Hence when the going gets tough, this is also the option which provides the best return for the effort employed - so long as you are reaching your potential collectors.

Key messages:

The economic situation remains difficult and forecasts are that this will continue for some years.  It's not going to go back to "normal" anytime soon. Hence....

• Become skilled at marketing your artwork direct from the studio. Using social networks, newsletters and blogs to communicate with past collectors and those interested in your art about your current art and what's for sale is an important activity.  It needs to be effective.
• Offer regular Open Studio events - these don't need to be limited to annual events organised by others
• Make it easy for people to commission work from you - explain the process on your website or blog and in a leaflet
• Make sure people know how to buy art direct from your studio - and what you're producing.  
• Be visible - use attractive business cards and postcards to remind people how they can contact you direct via studio, studio website, blog and/or Facebook Page.
• Gear up studio efforts to patterns of spending - eg be very organised about making art available for Christmas

The Best Place to Sell Art - Third Parties / Face to Face / on Commission

This essentially is the gallery option where a third party runs the exhibition and takes commission of sales.  That might be a commercial art gallery or an art society running a juried competition.

This chart is something of a mirror image of that relating to the artist's own efforts.

There is a direct correlation between the state of the economy and the importance of the gallery and sales on commission to an artist's income.  

• When demand is present in the economy then galleries do better, sell more and more artists have galleries through which they make sales.  Hence the percentage of artists reporting gallery sales as their main source of income increases.
• When the economy is in recession then demand reduces, sales volumes tend to decline for everybody and new ways of generating sales have to be found.  However there is always a lag before any new activities generate results (eg more galleries going to art fairs)
• As economic decline progresses, those galleries that have weathered the economic storm to date find themselves with less competition and in a better place for being choosy about the artists they take on their lists.  Inevitably their preference is going to be for established artists who can demonstrate solid sales throughout periods of economic difficulty.

When times are difficult sales via galleries reduce and galleries close - which can leave gallery artists with nowhere to sell their art.  In the last 12 months, it's been evident to me that the double dip recession is again having an impact on sales via galleries.  This has been reinforced by the survey results.

Key messages:

It's ESSENTIAL to

• Remember the bottom line is profit not sales - and to review at least on an annual basis the total profitability of relationships with various third parties.  
• Practice risk management with respect to commercial galleries ie "do not have all your eggs in one basket".  Develop a portfolio of galleries located in different places and avoid becoming too dependent on any one gallery.
• Exhibiting can be marketing. Remember many artists chalk up the expense of having work in juried competitions and art society exhibitions to marketing since the additional costs of exhibiting often mean little profit for the artist.  Galleries do review the work of artists at such exhibitions.

Tomorrow I look at

1. The Best Place to Sell Art - Temporary Venues - Art Fairs to Street Markets
2. The Best Place to Sell Art - eBay vs Etsy
3. The Best Place to Sell Art - Other Online Galleries