The news that 20×200, the site set up by Jen Bekman for
people to buy affordable art prints online, is now offline and struggling to
secure new funding is certainly not great for the company. It’s also a wake up
call for the large number of online art selling platforms that have launched in
recent years and for their venture capital partners that are betting pretty
heavily that selling art online is a recipe for success.
As the Deloitte and ArtTactic report I mentioned in
yesterday’s post discussed, more than 300 online art ventures have been
established across the world in recent years, which on some counts, should be
good very news for art buyers. As the report finds, “new online transaction
platforms add liquidity to the art market and will broaden the scope and depth
of art market data available, which in turn will improve transparency and
facilitate more accurate art valuations.”
In fact, there are other benefits. Since sites selling art
online are unencumbered by the physical infrastructure of the traditional
gallery or auction house, they can also make their commissions lower and the
whole business of buying art much cheaper and more accessible. Buyers can
discover new art and potentially build a whole collection from the comfort of
their own homes, not the occasionally intimidating setting of a gallery. In the
highly fragmented art market, bringing art and art buyers together wherever
they are in the world is no bad thing either.
But that will only work if buyers are prepared to sacrifice
the one thing that is central to the way that people traditionally buy art -
the chance to see it and experience it in the flesh first. That’s something
that many people will be reluctant to do, particularly with big-ticket
purchases. Although sites such as Artspace and Artsy also drive buyers towards
physical galleries, not all online art platforms facilitate in-person art
purchases too.
Without the ability to sell pricer art works, many start-up
art platforms are forced to sell cheaper art works in enough volume to prosper
on a diet of slim online commissions, an area where 20×200 seems to be
struggling..
I recently moderated a Google hangout for Skate’s Art
Research that discussed the challenges facing online art platforms with Chris
Vroom, co-founder and chairman of Artspace, Osman Khan, managing director of
Paddle8, and Sebastian Cwilich, president and COO of Artsy. Osman conceded that
although people might only buy art online without seeing it first at lower
price points today, “over time, you can move that price point up as you develop
a more established collector base, as collectors understand the validity of
your brand and as you become a more established market place.”
He added that by offering something that is part ly an
informational channel for buyers to explore new art and artists, partly a
curatorial service and partly a distribution channel, collectively online art
platforms are ”cultivating a new previously untapped community of art buyers”
and that “a rising tide lifts all boats”.
Hopefully he’s right about the rising tide, but given
20×200′s problems, it seems pretty certain that not all the online art selling
platforms launching or already active today are going to make it.