Expert Eye

Art Basel’s Marc Spiegler on Why the Superheated Art Market Isn’t a Bubble

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Art Basel’s Marc Spiegler on Why the Superheated Art Market Isn’t a Bubble
Art Basel director Marc Spiegler

Must everything that goes up come down? In the second half of an extended interview with Art Basel director Marc Spiegler, Artspace editor-in-chief Andrew M. Goldstein spoke to the former art journalist about where the market is headed.

READ PART ONE OF THE INTERVIEW:
Art Basel Director Marc Spiegler on How the World's Premier Fair Continues to Evolve

One reason that Art Basel has the luxury to experiment with crowdsourcing and other altruistic models, as we discussed earlier, is that the world is beating down your door to work with you. So while Basel is the most connoisseurial fair around—the place where dealers bring their best work—it’s also the fair that brands are most excited to be associated with, as we see with UBS, BMW, Kickstarter, Davidoff, Netjets, and Ruinart. In a recent New York Times article, you noted that Basel charges brands more to participate in the fair than galleries. How does the fair’s revenue from brands compare to its revenue from exhibitors?

The revenue from exhibitors is still more than twice as much as from those partners. We have a lot more exhibitors than we do corporate partners. 

But that seems like a very positive direction, with significant potential for increased revenue.

You have to keep in mind that for the first 25 years, Art Basel had no sponsors at all. The first sponsor was UBS in 1994, for the 25th fair. Also, when I started at Art Basel we were at the end of what we now call the “logos and lounges era,” where people would pay just to have a lounge with their logo on the wall. Now all of our major sponsors are doing much bigger things in the arts. BMW just did the BMW Art Journey, Davidoff is doing the Davidoff Arts Initiative devoted to supporting residences in the Dominican Republic and bringing Caribbean artists to the rest of the world, and Audemars Piguet has done projects like bringing Theo Jansen’s Strandbeests to Miami for the last Art Basel there. UBS of course also funds different arts projects from all over the world. The partners that we work with the most closely are companies that aim to engage them with the arts on a day-to-day basis, not just by popping up at our fairs.

Since these brands are starting to invest more in the creation and the display of art—in other words, taking on some of the traditional roles of the gallery—in order to market themselves, how do you see brands fitting into the Basel ecology overall? Is there a sense that they could be becoming another form of exhibitor?

I think it’s great when our sponsors do things in the arts, but I think it’s always very clear where the line is between the galleries and the sponsors. It doesn’t bleed from one to the other like it does in some other fairs. We don’t have sponsored lounges inside the exhibition spaces. 

It seems we’re in a moment of transition in the art world, and some traditionalists are balking at some of the changes underway. One of your longtime exhibitors, New York’s McKee Gallery, recently shut its doors, stating, “the art market has grown so vast that our gallery model is in danger: the collector’s private experience with art matters much less, as the social circus of art fairs, auctions, dinners and spectacle grows…. The value of art is now perceived as its monetary value. The art world has become a stressful, unhealthy place; its focus on fashion, brands and economics robs it of the great art experience, of connoisseurship and of trust.” What is the future for galleries like McKee? 

Obviously, running a gallery is a totally different job now than it was 25 years ago, but if you look through our halls you will find hundreds of people who are devoting themselves to working with artists in a highly engaged way on a day-to-day basis. Being a gallerist today means that you will have to understand how to work with social media, you will have to travel around the world, and you’ll have to deal with different cultures than your own. It’s a very different game, but frankly every industry in the world has likewise changed—they’ve been transformed by the globalization of the economy, for example, and by the speed that the Internet brings into daily interactions.  

So, yes, it’s a different art world than it was, but it’s a different world than it was. I don’t think the art world has changed more than other industries. In fact, it’s far less changed than some other industries—like taxis with Uber, or hotels with Airbnb. Yes,  in order to succeed in that new world you’ll have to operate differently than you used to, but it doesn’t mean that people can’t make careers working with fascinating artists and promoting them to great patrons and museums.  

It’s interesting at this moment to look back at a New York magazine article you wrote in 2006, titled “Five Theories on Why the Art Market Won’t Crash (And Why It Will Anyway).”

And yet it hasn’t. For the record, Adam Moss wrote that headline, not me.

It did go down during the financial crisis before rebounding.

How many galleries closed then? Not many. Sure there was a dip, but not like in other industries. The whole real estate market collapsed completely.

What do you think when you look back on that article?

I haven’t looked back on that in years, but the basic point with which I concluded the article is correct: there are variables that expand and contract markets around certain artists, certain cities, certain movements, certain aesthetics, but in the long run the art market just keeps getting bigger and bigger. The core of that market is made up of people who are quite serious about collecting. I think, for example, about the young collectors in Dallas, who collect in such a passionate way and who follow the example of the Dallas generation before them, people like Marguerite Hoffman, Deedie and Rusty Rose, the Stoffels, and the Rachofskys. Those are people who are buying in a very serious way, supporting institutions as patrons and serving on the committees of various boards. 

Or think about organizations like Creative Time, which has supporters from all over the world for an organization that does work primarily in New York City. The amount of real support for the arts is something that is often ignored at a time where there is a lot of focus on speculation and on artists that we may not be hearing about three or four years from now. Yes, everything has sped up—artists go from zero to 60 very fast, and sometimes back to zero. But the other thing that has increased is the quantity and quality of people who are entering the art world in a serious way and staying there. 

There was this very interesting piece in The New Yorker recently about my friends from Berlin, Christian and Karen Boros. The point made is that these are two very, very serious collectors who are highly engaged in art and who don’t sell. People like that are the counterbalance to what you hear about a lot, which is people coming in and buying not with their eyes but with their ears, as they say in Europe. They’re buying the artists whose names seem to be on the tip of everyone else’s tongues in the hopes that it’s going to go up. It may or may not, and if it doesn’t you can’t pity them too much. Because if they bought the work of an artist they don’t like in the hopes that it would appreciate they speculated, and they speculated the wrong way. 

The art market seems to be remarkably strong, but at the same time there is an undercurrent of fear that the current expansion is unsustainable. The recent $179 million performance of a Picasso at auction has set off a new batch of handwringing articles, by smart writers like Ben Davis and Adam Gopnik, which say that the end may be nigh. What is your read on the situation? 

I think we’re coming to a point where the term “art world” is actually deceptively simplistic. The reality is there are many art worlds. There’s a speculative art world centered around art that doesn’t have any more ideas than the people who are speculating with it—and then there’s a connoisseur art world, where you have people who are forever broadening their range of knowledge, collecting far beyond their own geographies and across many many decades of art history. 

Then you also have more regional scenes—you have great, serious artists who are coming out of the Middle East, coming out of Africa, coming out of Latin America, coming out of Asia, in ways you just didn’t see 10 years ago. It’s a more internationalized art scene than it was before, with a more internationalized collector base with more internationalized galleries. 

Thus, the flip side of the dangerously speculative trend around a handful of artists is the growth of the art market for a broader range of artists than ever before. As much unease as there is over the auctions, do we really want to return to an art world where only a few artists are able to survive without doing part-time jobs?

I don’t think anybody wants a return to that. But it’s interesting that the five “theories” you discussed in your 2006 article are very similar to the ones you just said—that there is this global growth of the art market, a tremendous expansion of its foundation. Back then you argued that despite this expansion, the market would still crash. Have you learned anything in this past decade that makes you feel that the art market is going beyond an inflection point, and that the industry has really taken root and will continue to expand?

Let me point out something with the article: I never implied that there would be a crash of 1929 proportions. What I implied was that there would be a contraction. If you think of the market like a balloon, inside that balloon is a lead core that is always expanding. I think what I’ve witnessed in my position in the nearly eight years that I’ve been at Art Basel is a market that is filled, every day, with more and more people who are seriously engaged with the arts. 

I think the art world is a lot like the Internet—on the one hand, the Internet on average becomes a dumber and more superficial place every day. That’s in relative terms. On the other hand, it becomes a greater repository of incredibly interesting information and knowledge every day. In the same way, in the art world there are more people trying to speculate around art and acquire status around art every day. On the other hand, there are more serious patrons for great artists every day. Whereas before the great skill of navigating the art world was to discover the next great thing, now the skill is doing the triage that allows you to focus on the next great thing. 

You have to learn how to process and choose between more data points across your radar much more quickly than you were ever used to. There’s a lot more art out there than there used to be—a lot of it is dross, but there’s still a lot of gold to be found. For example, it’s only in the last four years that the digital-native generation, which is so prominently featured at the New Museum’s Triennial, has really started to catch fire and deliver art that is both technologically and conceptually interesting. That’s a whole new development in the art world that wasn’t there before—people really playing with the Internet and digital technologies as a way of producing art and as a way of introducing new ideas and commentary into society.  

What is Art Basel doing to take advantage of this moment? Three years ago, during our last interview, you said you were looking closely at a range of digital initiatives. Has Kickstarter been the expression of that?

Kickstarter is one example of that, but we’re also working on a lot of things that we can do online to help the galleries promote themselves better. It’s not within our own channels, but we did a partnership with Instagram about a year and a half ago starting at Art Basel Miami Beach that is very, very successful. I think it brought a lot of attention to our galleries within the social media environment, because Instagram is such a good platform for displaying art—especially square-shaped art [laughs]. In general, we’re always thinking about what more we can do online to help our galleries promote themselves—and we’re far from finished working on that. 

But these things take time to develop. And quite frankly, the main focus of the organization for the last few years has been to really anchor ourselves in Asia. That was a possibility that opened up for us and that we embraced. Keep in mind, when Basel is done our organization will have done five international art fairs in the space of 13 months. That’s a lot.

It seems like Art Basel is going through a transitional stage right now, just as the rest of the art market is evolving. After last year’s Art Basel there were some changes in the organization, with Annette Schönholzer stepping down and Magnus Renfrew departing as the head of the Asian operations. What exactly happened with the changes in management, and how has the fair reshaped itself since then?

There really hasn’t been a major reshaping. Magnus went to work for Bonhams, where he had worked before, and Annette Schönholzer, at the age of 50, decided that she wanted to pursue other things—although she’s still working with us closely on several projects that she had been working on as director of new initiatives. As the press likes to do, there was this reaction of, “Oh my god, what’s happening in Basel? There’s only two out of four directors left!” But we hired Adeline Ooi as our Asia director and more recently promoted Patrick Foret, who was head of sponsorship, to director of business initiatives, so we’re back up to four directors. 

That seems like a pretty good number to me, because we’re an organization that has gone in the seven years that I’ve been there from having 17 full-time employees to having roughly 50 now. When I started we had eight VIP-relations managers—now we have more than two dozen. It’s an organization that expects more of itself, and from which people expect more, than ever before. I think the fact that we have a director for Asia and a director of business initiatives and a director for sources and finance reflects that very well. 

Magnus and Annette left in relatively close proximity to each other by coincidence, and it obviously created a lot of extra work for some of us, but it didn’t reflect any desire to shift things from the organization. It reflected personal decisions. Before Adeline arrived there was thiscrazy speculation that we weren’t going to replace Magnus for a while, but obviously that would have been suicidal for us. For me to try to directly run all three fairs would have been insane. Annette’s new initiatives were spread out into other departments, but many of them continue onwards. Patrick is working on other projects as well, to look at what we can do beyond the fair.

Another logistical consideration that you have coming up is that renovations to the Miami Convention Center have been announced. What is going to happen while that is underway though 2017?

We’re working very closely with the city to understand the phasing, and they’re working very closely with us to make sure it doesn’t impact us too much. The show will happen. Some of the other things we do will be affected, but with the new mayor and the new city manager we have a city administration that really values what we bring to the city. One of their primary objectives as they go through this renovation is to make sure that Art Basel in Miami Beach is not affected in a negative way.

Considering how your organization has grown over the past few years, what is the overall Art Basel footprint in terms of the galleries it works with across all of its fairs?

We now deal with roughly 550 different galleries per year. Some of them do all three shows, but many only do one. The fact that we’re now dealing with 550 galleries, and their artists, and their collectors gives us an incredibly global role, especially in Asia. We’re in a position to really shape the patronage of galleries by promoting them heavily. There are a lot of collectors who have never left their countries before to go to a fair and who now realize that there’s a lot going on in the region that they aren’t conscious of. They come now because they realize what an art fair can be, because of what we’re doing, because they heard about it from their friends. 

Likewise, the Kickstarter initiative was a very good example of us taking on a greater responsibility within the art world, to support a sector of our world that we think is incredibly important but isn’t really getting the support that it needs in order to thrive. This is just the beginning of us thinking about our role in the art world. Because one thing that we do not take for granted is that the art world of the future will have an important role for galleries, as it has in the past. We need to serve their position, which is essential fur pushing artists forward.

READ PART ONE OF THE INTERVIEW:
Art Basel Director Marc Spiegler On how The World's Premier Fair Continues To Evolve

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