“Crucial Tip for Artists and Collectors: Why Some Art Sells for $1,000,000 versus $1000”
by Debra Hand
Years ago, coming into the art world as a full time artist, there were two very specific issues I wanted to understand. First, I wanted to know why some artists were able to sell work for $1,000,000 while other artists of equal talent might only be able to sell work for $1000 or two. Secondly, I wanted to know why I never saw art by African-Americans in major museums.
In the first case, where one artist was able to sell works for much more than another artist, it was easy to see that the differing price points had not been decided by talent alone. It was also easy to see that paintings and sculptures collected by major museums weren’t selected based on artistic talent alone. I began to look at other factors: the types of works being produced; consistencies in themes; types of materials used; level of creativity, and innovations in approach or concept. A pattern began to emerge. In the major museum world, whenever American art was the focus, Caucasian male artists dominated the landscape for both living and past artists. In the major auction-market world, male artists dominated. In the gallery world, male artists dominated. In the national art-fair-world, male artists dominated. Why? The answer was simple: Caucasian males also dominated the decision making areas of each of those fields and businesses, especially in the upper-tiers which was effectively the ultimate “boys’ club.” Okay, so no rocket scientist needed to figure that out. But how does one get into that club? It requires more than only being Caucasian and male. Many talented Caucasian male artists were also laboring in obscurity and their art never seeing the upper stratospheres of the market. So, which elements determined whose art made the cut, and whose didn’t?
Looking more at the art itself, rather than the structure of the boys’ club, I tried to understand what defined great art. What made one thing art and one thing junk? More patterns emerged. In almost every case where an artist, or an art movement has risen to the top of the art-world, someone with a personal interest in the artists, usually a collector, decided to invest in the promotion of the artist’s work. But the collector did more than just purchase artwork now and then. They also began to promote that artist as being “the best of their day.” The collector also promoted that artist to other collectors and brought them into the view of the string-pullers. The collector attended the artist’s shows, publicized their purchases, brought the artist into their dinner parties and social circles, and practically took on a PR role for the artists they collected. In most cases, the collectors also developed a narrative context for their own art collections, and helped to position their collections and their artists, within the art historical narrative. It didn’t necessarily matter what style of work an artist was creating, once their name created a buzz among collectors in those upper-tiers, those collectors then joined the campaign to elevate the artist and the categories of Contemporary art were expanded to include the artist, even if they had not fit neatly into prior categories. For example, a messy bed sold for $6,000,000. Like, in real life, a messy bed is now considered art. Obviously, you just can’t go from art categories that include the likes of Vermeer, Rembrandt, and Picasso — to art categories consisting of messy beds, without plenty of marketing smoke and mirrors. This is an intentional process with someone leading the charge. In today’s Contemporary art market, it is not necessarily the quality of the art that moves such artists up the ladder, but rather the quality of writing and marketing behind an artist, plus the heftiness of the bank account of the collector, or art dealer behind them. And even where an artist is immensely talented, it is usually an institution such as a prestigious art school, or a deep pocketed collector who helps to pull an artist’s work out of the obscurity of their studio and into the bright lights of notoriety. For all artists, even when one is immensely talented and is able to create a good living — it is still the collectors’ base that provides the oxygen to sustain their art business.
Artists, of any color, who never find such champions, will have a harder time staying in business than those who have support. When it’s all broken down to the parts that make up the whole of the art-market, it’s a simple formula: Artists need collectors! They need collectors to share their journeys, and to believe in their shared contributions to culture. They need collectors who will become champions for their work; collectors who are willing to grow with them, experiment alongside them by commissioning the artist to create new styles that stretch and explore their creativity. Artists need collectors who also believe in themselves as collectors, and who will be strong enough to wholeheartedly stand behind what they collect — even in the face of an art-market that tries to make them feel inadequate to make their own decisions. When an art merchant can convince a collector that the collector doesn’t know what great art is, then the merchant can control that collector and their wallet. They can decide for the collector what the collector will value and then name that value for them. This happens all day long in the art world, especially on the uppermost levels. Unfortunately, some collectors have seen artworks quickly go from selling for thousands to selling for millions. They believe all they have to do to get in on the game is to find great artists, buy their works for a steal, and then hold onto the works while values grow, grow, grow. They go to auctions and sometimes conspire with each other to keep the price of the artwork as low as possible: one collector saying to another, if you don’t bid on that one that we both love, I won’t bid against you on this one that we also both love. This might result in each collector getting at least one of the works they love at the very minimum bid, but they have done much more. Those collectors have just artificially suppressed the market value of the artists’ works. They bought low which just publicly set new market values and market expectations for the works they won with those low bids. Effectively, each of these collectors is not only hurting the businesses these artists are working hard to sustain, but they are also sabotaging their own plans for the art growing in value. They just publicly announced to the art-market that their art is of minimal value and the auction records for that artist will be adjusted accordingly and used to value future works at auction.
Collectors should understand that they are the ones who ultimately influence a work’s perceived value in the marketplace. It’s the collector who decides over time, what works will sell for $1000 or $1,000,000. Everything revolves around their behavior and whether they have high regard, or a lack of regard, for the artists whose works they collect. An artist can sell 10 similar pieces for $10,000 each, and the minute a collector buys a similar work in a public auction for $5,000, they just publicly established that the artist’s work is now only worth 50% of its previous value. This will definitely discourage future investors. By the same token, had the collector paid $20,000 for that same piece, they would have publicly established that the market value of the artist’s work has now doubled. This attracts new investors to the artist and helps to grow the value of the original collector’s work. Whatever someone is willing to pay for a piece of art, that amount is its current market value. This goes for works by everyone, even paintings by Picasso or Michelangelo. That’s why sellers and auction houses place minimum bids or reserve prices on pieces, so works will not be sold in unfavorable markets.
If as a collector, you want to assure that works by your favorite artists grow in value, try to fight the urge to always get the artist’s work for a steal. Discounts are great, we all love them, but if you’re always driving down the market value of the artists you collect, how can the value of your collection rise? The auction houses will just continue to value the work at the same low price-point that you helped to establish. The only thing that will change the trajectory of those prices is if a magnanimous collector comes along who respects the artist and decides to bid the work up. Or they decide that the artist is not getting the attention they deserve and they begin to take steps to assure that the artist’s name is injected into the right art-world conversations. I talk more about this in a previous article titled “Art World Explained: Expected to Fetch” which can be found on this website.
Meanwhile, please know this: the difference between an artist selling for $1,000,000 versus $1000 will either begin or end with a collector somewhere: a collector who believes in the artist enough to make sure the rest of us know how great they are…even if we don’t agree. As for Black artists, they need collectors who are willing to not only say that the artists they collect are great, but also — they need collectors who are willing to position their collections as “the best” in the perceptions of others. The late Paul R. Jones famously did this. He joined museums so he could influence how they thought about African-American art. I once interviewed him. He made the point that most museums ”would rather purchase works by ‘well-unknown’ Caucasian artists, than to purchase works by well-known African-Americans.” He set out to change that. At the time of my interview with Jones, he was considered by Arts and Antiques Magazine to be one of the top 100 collectors in the nation. Even then, he had a plan for his collection both during and after his life. He left part of his collection to the University of Delaware and part of it to The University of Alabama, but with certain conditions for how that work would be used, exhibited, and otherwise made available to scholars.