The art market is highly segmented – Magnus Resch

https://www.youtube.com/watch?v=/x8Qhxiy-Q6Q


The art market is heavily skewed in favor of a few artists who are good at networking, said Magnus Resch, art economist and author.


“Twenty artists represent almost 50% of the total value of the contemporary art auction market,” said Resch. “If you want to make money investing in art, it’s very simple. Buy one of the big names in the house.


Resch gave the examples of Andy Warhol, Jeff Koons and Damien Hirst as household names. He added that when it comes to investing in big names, there are nuances.


“A green Warhol sells for less than a red Warhol, and a 1981 Basquiat sells for more than a Basquiat in its later days,” Resch explained. “It comes down to the little nuances and access to those main works, the top of the top of the top.”


According to Resch, “99.999% of artists” are not a good investment.


Resch spoke with David Lin, presenter and producer at Kitco News.


NFT


Non-fungible tokens (NFTs) are records on a blockchain, corresponding to assets. Often, NFTs are digital works of art.


The Merge, which depicts the orbit of two spherical planets, is the most expensive NFT ever sold, priced at $91.8 million.


“The NFT world is weird,” said Resch, author of the book, How to create and sell NFTs. “There’s only one reason people buy NFTs, and that’s because they want to make money.”


Because NFTs are tied to a blockchain, their proponents claim they are difficult to hack or counterfeit. Thus, NFTs have a built-in security feature that verifies their authenticity.


“[NFTs] are here to stay because technology can revolutionize the art world,” Resch said. “When you buy a piece of art on the secondary market… what they show you in order to prove its authenticity are the invoices from the gallery they originally bought it from. The invoices are from the paperwork and can be tampered with. NFTs can solve this problem. I believe that in the future, every piece of art that leaves an artist’s studio will be registered as an NFT.


Be a successful artist


For those considering a career in art, Resch’s research shows that social media matters more than skills or training as an artist.


“If you’re not part of that core network in the first five to ten exposures of your career, you’re not going to make it as an artist,” Resch said. “We looked at all the different other factors, like the colors of the paintings, the subject, the material, the age of the artists, etc. But what really mattered to the success of the artist was the network in which it is.


Resch added that “there is only one network that leads to success, and that network consists of a few galleries and a few museums.” He clarified that “nine of the top 10 institutions in this core network…are in New York.”


For Resch’s predictions for the NFT network, watch the video above


Follow David Lin on Twitter: @davidlin_TV


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