There is no shortage of information or opinions on Millennials - our consumer habits, our behaviors in the workplace, our lifestyle choices, our political perspectives. We're fascinating because we differ so dramatically from previous generations, and because we're the largest single age cohort today in the U.S. 

I've read countless analyses on Millennials' relationship with so many industries - luxury goods, housing, travel, beauty - but I've never come across a quality in-depth analysis of Millennial behavior when it comes to the art world. I'm talking about all of its interdependent facets: the market, philanthropy, the public sector. 

So I'm sharing my (data-backed) thoughts in a series on this blog. In this installment I will look at Millennials' relationship to the art market, and I'm asking the question: will we eventually see a measurable disruption in the art market based on Millennial values?
 

You can’t talk about the art market without acknowledging its context; it is one piece of the larger art world ecosystem, a network of relationships and connections that have been built over decades behind closed doors, whose influence extends beyond the market itself to museums, foundations, corporate art collections, and the public sector.

There is a correlation between donating and collecting, and just as we’re not sitting on art museum boards, I have the sense that Millennials are not buying or collecting expensive art (which I will define here as having a price of $10,000 or more). Of course this could be because they simply have not accumulated enough wealth yet, but I'm contending that the values of Millennials diverge so greatly from the values of previous generations that they will not collect art in the same ways, whether or not they accumulate wealth. 

There is some evidence in the recent shortfalls of the hybrid art/tech companies that cater to their consumer behavior (Artspace and Paddle8 come to mind right away), and in the struggles and closures of galleries run by young dealers that inherently understand younger generations’ values. Because as with other luxury goods, we want to discover and purchase art online.

Artsy, an outlier among online art companies, isn’t wrong about that. The company is bringing a historically analogue industry online, which is noble and necessary, and by its own admission, it is an improver, not a disruptor.  Its technology, which complements existing art world systems, may be successful in reaching younger generations - but even if you build it, and even if they come, will they buy expensive art? That is - do they value it monetarily?

To continue in this vein, the reality is, the online art market makes up at most only 10% of the overall art and antiques market, which is notoriously difficult to measure. Various reports cite between a 4-15% year-on-year increase in online sales - a not insignificant (and strangely wide) range, but nowhere close to the projections made in 2013 - an annual growth rate of 25% and a €10 billion valuation by 2020.

According to a recent report commissioned jointly by Art Basel and UBS, individual online sales tend to average between $3,000 and $5,000. We can make some guesses from this data regarding what young buyers are willing to spend on art they haven’t seen in person, and the value they place on art in general. But this information is self-reported, and dealer survey response rate for these kinds of reports can be as low as 5%. So any conclusions drawn from these reports are truly guesses. 

But if we make an assumption that Millennials want to actually transact online, these numbers are not good, and they don't show confidence-instilling growth. So while Millennials are starting to buy houses and put down roots, it's hard to get a sense of whether or not they're starting to value art in the same way.

Millennials, more than any other generation, seek transparency and authenticity when making significant financial decisions, whether they’re making a purchase or a donation. Information needs to add up, and it needs to make sense. The art market, especially the measurement of the primary market, doesn’t make sense. It is not consistent with Millennial values, and at a certain point, I have to imagine that there will be financial ramifications as a result. If Millennials do indeed collect art as an asset, or decide to invest in an art collection, my assertion is that we will seek out artists that we identify with or believe in, or that associate with causes that we care about. 

We came of age in the aftermath of the once-every-hundred-years financial storm. If we don't trust the art market, it's for the same reasons that we also do not trust the stock market, and have not trusted the housing market (until recently). Art's empirical monetary value in a market that is opaque and contradictory is not a strong enough motivator to buy.

But this is not to say that Millennials don’t care about art; we are deeply interested in art and design, it's just that we experience art differently than previous generations. We love to be surrounded by art, but we value it in a different way; that is, we're less likely to "accept" art's empirical market value. We do see an inherent value in art that is authentic, impactful, and reflective of our collective human experience. To many Millennials, that is the only art that matters, and technology as accelerated its rise. 

There is so much more to say - about young billionaires, about art market contraction, about the reality of how few artists are truly making a living selling their work - but it really boils down to this: If anything is to disrupt the art market, I think it will eventually be the divergent values of Millennial and Gen Z consumers. There will always be an art market, and there will always be people that want to buy valuable art; but eventually I think we will see these values reflected in the way that art is bought and sold. 

To digress as a means of transition: if Millennials are not buying expensive art, we are certainly consuming it, mainly through experiences, which puts more pressure on the institutions that commission, curate, and display it. And even with strong attendance figures, and even with innovation and branding, the current business model of large American museums relies on the endurance of private philanthropy.

So - next up? Millennials and philanthropy in the visual arts.