Art World Players Rethink The Auction Marketplace
A new peer-to-peer digital platform lets high-end collectors buy and sell without the middleman.
A new peer-to-peer digital platform lets high-end collectors buy and sell without the middleman.
Collectors have long enlisted dealers or auction houses to help resell their art holdings because such insiders typically have up-to-date pricing data and access to potential buyers.
Now, in the latest challenge to the art world’s status quo, a team led by former Sotheby’s rainmaker Adam Chinn plans to launch a peer-to-peer digital marketplace later this month that will invite collectors to sell high-end art to each other, directly and anonymously. Listings in an early version of the site, called LiveArt Market, include an Andy Warhol “Rorschach” from 1984 valued around US$200,000 and Jack Pierson’s 2009 sign, “Glory,” valued around US$85,000.
The move comes as all sorts of art-world players rethink the traditional ways art gets traded online, from former Christie’s auctioneer Loïc Gouzer’s Fair Warning auction app to the proliferation of digital platforms selling NFT artworks. Even as the art world’s attention increasingly pivots back to in-person art events including fairs, online sales of luxury goods remain robust and some top industry dealmakers see a bigger market opportunity in finding fresh ways to sell art to collectors accustomed to shopping for art online.
“Collectors go to gatekeepers because they need pricing info, but we want to put collectors in control,” said Mr Chinn, Sotheby’s former chief operating officer. Late last year, he teamed up with artificial intelligence experts and former auction specialists like George O’Dell to buy and retool Live Auction Art, then an auction-tracking data site. The new owners have now equipped the site, renamed LiveArt, with machine-learning technology so it can analyze auction data and give users free, real-time estimates of their collection’s likely market value. The key to success will be convincing collectors that LiveArt’s pricing and provenance services are as reliable as those collectors would get from the auction houses.
The architect behind the tech is Boris Pevzner, a graduate of MIT known for creating and selling several companies that use AI-driven algorithms, including one that resolves freight-shipping issues and another that manages art collections, Collectrium, that he sold to Christie’s in 2015.
Starting later this month, LiveArt will add the marketplace component to double as an online platform for private art sales. People can upload artworks and specify any details they want shared or kept from potential buyers, including their own identities. Once listed, an artificial intelligence bot on the site will help them sift offers or field questions from potential buyers—like bots on retailer sites already do—as well as mediate deal terms so both parties remain discreet, if they choose. Once under contract, the seller will be asked to ship the work to the company’s clearinghouse in Delaware, where conservators and former auction specialists will check its condition and vet provenance before sending it on to its buyer, Mr. Chinn said.
He added that LiveArt has hired a team of provenance researchers, including some from Phillips, to vet work and if there are provenance disputes between buyers and sellers, the site will offer mediation. (LiveArt only charges buyers a flat 10% fee for any sales versus the big auction houses which can charge more than 20%.)
Christie’s and Sotheby’s didn’t immediately comment on Mr. Chinn’s new venture.
New York art adviser Alex Glauber, who isn’t involved with the venture, said the matchmaking element of a peer-to-peer digital marketplace could “solve a practical problem” for collectors who want to sell middle-market pieces without paying steeper fees to an auction house or wrangling a gallery to promote their consignments ahead of the gallery’s own inventory or artists.
Mr. Glauber said he plans to upload a few pieces to test the experience before he suggests it to his clients. He said the challenge will lie in persuading a “critical mass” of sellers, who typically prize discretion, to reveal the art they’ve got in storage. “Even with all the security assurances, some people may be reluctant to push their pieces online,” he said. “It’s going to take some convincing.”
David Rogath, a Connecticut collector who owns pieces by David Hockney and René Magritte, said he also has no ties to the venture but said he has bought and sold plenty of art through Mr. Chinn during his tenure at Sotheby’s, so he’s intrigued by the platform. “I have things I want to sell and things I don’t want anyone outside my family to know I own, and Adam understands discretion is key,” Mr. Rogath said.
Mr. Rogath said he used LiveArt’s pricing tool to test the values for several works he’s owned over the years and said he found them accurate. Mr. Rogath also said the site appears to smooth out some “speed bumps” that have historically dissuaded top collectors from brokering major sales to each other, including the logistics of hiring third parties to research and vouchsafe a piece’s condition and authenticity. If a platform can take over those real-world hassles, he said, “For a collector, there’s an allure to cutting out the middle man.”
Reprinted by permission of The Wall Street Journal, Copyright 2021 Dow Jones & Company. Inc. All Rights Reserved Worldwide. Original date of publication: May 5, 2021
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Vacationers scratching their travel itch this season are sending prices through the roof. Here’s how some are making trade-offs.
Capri Coffer socks away $600 a month to help fund her travels. The Atlanta health-insurance account executive and her husband couldn’t justify a family vacation to the Dominican Republic this summer, though, given what she calls “astronomical” plane ticket prices of $800 each.
The price was too high for younger family members, even with Coffer defraying some of the costs.
Instead, the family of six will pile into a rented minivan come August and drive to Hilton Head Island, S.C., where Coffer booked a beach house for $650 a night. Her budget excluding food for the two-night trip is about $1,600, compared with the $6,000 price she was quoted for a three-night trip to Punta Cana.
“That way, everyone can still be together and we can still have that family time,” she says.
With hotel prices and airfares stubbornly high as the 2023 travel rush continues—and overall inflation squeezing household budgets—this summer is shaping up as the season of travel trade-offs for many of us.
Average daily hotel rates in the top 25 U.S. markets topped $180 year-to-date through April, increasing 9.9% from a year ago and 15.6% from 2019, according to hospitality-data firm STR.
Online travel sites report more steep increases for summer ticket prices, with Kayak pegging the increase at 35% based on traveler searches. (Perhaps there is no more solid evidence of higher ticket prices than airline executives’ repeated gushing about strong demand, which gives them pricing power.)
The high prices and economic concerns don’t mean we’ll all be bunking in hostels and flying Spirit Airlines with no luggage. Travellers who aren’t going all-out are compromising in a variety of ways to keep the summer vacation tradition alive, travel agents and analysts say.
“They’re still out there and traveling despite some pretty real economic headwinds,” says Mike Daher, Deloitte’s U.S. transportation, hospitality and services leader. “They’re just being more creative in how they spend their limited dollars.”
For some, that means a cheaper hotel. Hotels.com says global search interest in three-star hotels is up more than 20% globally. Booking app HotelTonight says nearly one in three bookings in the first quarter were for “basic” hotels, compared with 27% in the same period in 2019.
For other travellers, the trade-offs include a shorter trip, a different destination, passing on premium seat upgrades on full-service airlines or switching to no-frills airlines. Budget-airline executives have said on earnings calls that they see evidence of travellers trading down.
Deloitte’s 2023 summer travel survey, released Tuesday, found that average spending on “marquee” trips this year is expected to decline to $2,930 from $3,320 a year ago. Tighter budgets are a factor, he says.
Wendy Marley is no economics teacher, but says she’s spent a lot of time this year refreshing clients on the basics of supply and demand.
The AAA travel adviser, who works in the Boston area, says the lesson comes up every time a traveler with a set budget requests help planning a dreamy summer vacation in Europe.
“They’re just having complete sticker shock,” she says.
Marley has become a pro at Plan B destinations for this summer.
For one client celebrating a 25th wedding anniversary with a budget of $10,000 to $12,000 for a five-star June trip, she switched their attention from the pricey French Riviera or Amalfi Coast to a luxury resort on the Caribbean island of St. Barts.
To Yellowstone fans dismayed at ticket prices into Jackson, Wyo., and three-star lodges going for six-star prices, she recommends other national parks within driving distance of Massachusetts, including Acadia National Park in Maine.
For clients who love the all-inclusive nature of cruising but don’t want to shell out for plane tickets to Florida, she’s been booking cruises out of New York and New Jersey.
Not all of Marley’s clients are tweaking their plans this summer.
Michael McParland, a 78-year-old consultant in Needham, Mass., and his wife are treating their family to a luxury three-week Ireland getaway. They are flying business class on Aer Lingus and touring with Adventures by Disney. They initially booked the trip for 2020, so nothing was going to stand in the way this year.
McParland is most excited to take his teen grandsons up the mountain in Northern Ireland where his father tended sheep.
“We decided a number of years ago to give our grandsons memories,” he says. “Money is money. They don’t remember you for that.”
Chima Enwere, a 28-year old piano teacher in Fayetteville, N.C., is also headed to the U.K., but not by design.
Enwere, who fell in love with Europe on trips the past few years, let airline ticket prices dictate his destination this summer to save money.
He was having a hard time finding reasonable flights out of Raleigh-Durham, N.C., so he asked for ideas in a Facebook travel group. One traveler found a round-trip flight on Delta to Scotland for $900 in late July with reasonable connections.
He was budgeting $1,500 for the entire trip—he stays in hostels to save money—but says he will have to spend more given the pricier-than-expected plane ticket.
“I saw that it was less than four digits and I just immediately booked it without even asking questions,” he says.
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