Cracking the Millennial Market: How Art Businesses Are Tweaking Their Strategies to Target the Next Generation of Collectors
Art dealers and auctioneers are getting creative to tap into the coveted new demographic.
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When KAWS’s painting of characters from The Simpsons sold for $14.8 million at Sotheby’s Hong Kong in March, the news seemed to herald the buying power of a new generation of art collectors. Nearly half of the attendees at the sale, which was dedicated to the private collection of 48-year-old Japanese DJ and fashion designer NIGO, were under 40 years old. “The auction room suddenly got a lot hipper, with all these cool millennial buyers in hoodies,” Edie Hu, art advisory specialist at Citi Private Bank in Hong Kong, told Bloomberg after the auction.
Millennials, now ages 21 to 38, offer huge new market potential for auction houses, dealers, and art advisers—and not only for artists like KAWS (who is 45). They are the largest generation in the US labor force, numbering 56 million, according to the Pew Research Center. They’re also the fastest-growing segment of collectors among high-net-worth clients surveyed last year by US Trust, with eight percent more owning art in 2018 than the previous year.
“The majority of collectors are Baby Boomers,” says art advisor Heather Flow. “They will soon transfer their wealth, and their collections, to their millennial kids,” and it will be the largest wealth transfer in world history, with estimates of the impending inheritance ranging up to $68 trillion.
We spoke to a few experts in the field about their strategies for targeting this maturing new demographic of art collectors.
Find the Right Price Points
Many younger collectors came of age in an anemic labor market, and many of them continue to have less buying power than preceding generations, which has implications for price points.
It took Ellie Rines, who says that two-thirds of the clients at her gallery in New York, 56 Henry, are under 40, a while to nail the entry level for younger buyers. But she now says she’s found that a good price point is around $500 to $700—“the same amount you spend on a nice pair of shoes.” Indeed, despite her large percentage of millennial buyers, they account for only 30 percent of her revenue. Former dealer Patton Hindle’s now-shuttered New York gallery, yours, mine & ours, also often sold work for under $1,000. For Rines, it’s worth it: “I’m very interested in being the first place that someone buys art.”
And it’s not only young galleries dealing in three-digit sales—it’s auctioneers, too. Phillips’s online-only “Unbound” auctions head quite a ways down the price spectrum. Recent sales included a Christo lithograph-and-collotype work that sold for $750 and an Elizabeth Peyton Xerox print that went for just $375.
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