Christie's CEO Faces A New Pandemic-Era Reality

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Christie's CEO Faces A New Pandemic-Era Reality
February 9, 2021

Earlier this month, Guillaume Cerutti, CEO of Christie’s, participated in a webinar discussion as part of the “ARTnews LIVE with CEOs” series. At that event, video of the interview above; he talked about his company and how it is coping with the new realities of the global marketplace during this pandemic. During the webinar, attendees submitted questions for Cerutti. He answered those questions a few days after the webinar. Below are some of his responses.

 

Are you still finding opportunities to expand as a business amid the new paradigm we find ourselves in?

Absolutely. We have tried to use the disruption of the pandemic as an opportunity to stop doing things simply because they had always been done that way, and instead use this as a time to rewrite the playbook if it benefits the business and our clients.

 

What is the percentage of private sales in 2020 compared to 2019? How do you see your relationship with dealers? Has it changed, and if so, how? 

In 2020, private sales represented about 30 percent of our total sales, against 10 percent–15 percent in normal years. The traditional and paradoxical aspects of auction house relationships with dealers haven’t changed much: we are competitors and we are partners at the same time, even though we have probably seen more partnerships in 2020. At Christie’s, we piloted collaborations with art fairs, with some notable successes (the 1-54 Contemporary African Art fair, for example). We will continue on this front in 2021, as I truly believe that the future of the art market will be more collaborative.

 

You say, Guillaume, that sales in Asia amount to more than those in America. Is that true for art made before 1914?

Absolutely. Asian buyers are a driving force for Impressionist art, and several of our top buyers for classical decorative arts in 2019 and in 2020 are based in Asia. And of course, sales of Chinese works of art and classical paintings are primarily led by Asian collectors.

 

How do you explain the meteoric rise in prices for some very new and young artists whose prices went, in a few months during the pandemic, from five to seven figures? Do you think the price points for those artists are sustainable?

It’s a great question. I am a little bit old-school here, maybe because I began my career working in a museum, and I am always slightly nervous when I see young artists very quickly propelled to six-figure prices or higher, while some major artists of the 20th century, already recognized by art historians and institutions, are not yet there. That is because we are a marketplace, where a price just reflects the balance between supply and demand at a given moment. The long term will determine the truth about real value versus instant prices. Some will stay, some will disappear!

 

What artists under age 45 sold particularly well in Asia last year?

Dana Schutz, Adrien Ghenie, Amoako Boafo, Jonas Wood, Nicolas Party, Eddie Martinez, Jia Aili, Huang Yuxing, and Hao Liang, among others.

 

With the impact of the pandemic on the economy, how does Christie’s plan to encourage graduates to pursue a career within the art world and make it more accessible to them?

We are actively looking for ways to diversify the graduate talent pool we draw from, at all levels of our organization. The auction world has always been insular and inward looking in nature, which means we need to work harder to make sure people know that our doors are open to everyone, in every sense. One example I mentioned is a rethinking of our paid internship and graduate assistant program, to ensure we are supporting candidates from outside the major cities where we operate, where the cost of living can be prohibitive. This is just one component of our larger initiative around Equity, Diversity and Inclusion at Christie’s, which is global in focus, and a key pillar of our corporate plans and priorities for the year.

 

What does Christie’s think about digital art?

We are following digital and new media art with great interest, and from time to time, we like to include one of these artworks in our sales to help them receive greater public recognition. That is what we have done for art generated by artificial intelligence (in 2018, with Obvious) or, more recently, with Marina Abramović’s first mixed reality performance artwork. The overall area—and especially crypto art—needs to be promoted and further developed first through dealers, critics, private collections and institutions, then through the secondary market and auction houses.

 

Do you see any sales moving to—or including—blockchain in the future, or is that a passing trend? 

This is an interesting development in the art market that can definitely add something to a transaction (security, confidentiality), and I think we will continue to utilize it in partnership with our clients and their needs. That is what we have done successfully in partnership with Artory on the sale of the Ebsworth Collection three years ago. We will look for these pilots on a selective basis, and where there is a clear benefit to our clients in the global collecting community.

 

Are you seeing an increase in demand from collectors wanting to work with Christie’s in more financially sophisticated ways (i.e. through guarantees and with a flexibility of terms)? If so, how is the house looking to meet this demand? Are these arrangements mostly with long-standing American and European clients, or is Asia ripe for such models too?

This is a very good question. 2020 was an unusual year: collector demand was resilient, but supply was more difficult [to obtain], with some consignors being concerned by the impact of the pandemic. Private sales and guarantees have undoubtedly been a way to reconcile these two diverging trends. There are traditionally fewer guarantees in Asia than in Europe and in America, for various reasons. In any event, the decision to use a guarantee remains case by case, according to each consignor’s risk appetite.

 

With so many online sales during the pandemic, have you heard of anyone experiencing buyer’s remorse ?

Every online seller experiences such instances, and our client care teams address them as they come up. It’s important for our clients to understand we are in the business of building long-term relationships. In difficult times, I think the temptation with online retailers can be to push as much property through the channel as quickly as possible, without care for the ongoing transactional relationship. We wish to do the opposite, and it’s the reason you will see Christie’s continue to focus on selectivity, curation, and continued enhancements to the client experience in the year ahead.

 

How is Christie’s going to develop in Paris this year? Will you expand?

Paris has always been an important sales site for Christie’s—remember our legendary Bergé-Saint Laurent sale at the Grand Palais in 2009. The city is also a great place to experiment new concepts, like our partnership with 1-54 African Contemporary Art fair that is now underway. We will continue to invest in Paris, where I am also pleased to say we have a great team, led by the very talented Cecile Verdier.

 

What is your strategy to engage with existing and new collectors in the MENA region?

The Middle East is an important place for Christie’s. We have several very important clients there, and the museums landscape is also evolving fast. Historically, we were the first international auction house to operate from the Middle East, when we opened in Dubai in 2005. We host modern and contemporary art sales there, as well as very successful watches sales. We also hold previews in Dubai of international auction highlights, as well as private sales in order to give clients in the region a gateway to Christie’s International. For Middle Eastern artists, we are conscious that we don’t want to engage solely with local collectors through our sales in Dubai—that would be too reductive. That is the reason why we have also developed our sales in this category in London.

 

What will be the effect of Brexit on the London sales and market?

It’s difficult to predict. We need to wait a few months. London should remain a major hub for the art market, especially if the British authorities take advantage of the Brexit to get rid of VAT on import of works of art that will continue to apply in the E.U. On the other hand, clearing the customs could become a deterrent for non-U.K. European sellers. Much remains to be seen, and it may be that the real shift (and challenge) for the art market is less within Europe than between Europe on one side and New York and Hong Kong on the other.

 

A few of the powerhouse galleries have now joined forces to provide advisory services and bring to market prominent estate collections. What are your thoughts on the new competition in traditional auction house cornerstones? Is this new landscape sustainable, and can you coexist?

Great question. My sense is that, if you look at the longer period, there is a convergence in the ways mega-galleries and major auction houses operate (I am talking here about the post war and contemporary art segment). Mega-galleries have developed their global network, and are incredibly innovative in the way they communicate and approach their clients. And the VIP opening of a major art fair is in essence not so different from an evening auction sale: an exclusive event for top clients in the same place for a few hours. At the same time, auction houses have dramatically developed their private sales, competing more directly with some galleries. The consortium of three dealers for the sale of the [Donald] Marron collection is another illustration of the fact that the landscape is evolving and that competition is everywhere. But that should also result in more collaborations—between galleries, between auction houses (Christie’s/Guardian for example), and between auction houses and galleries.

 

Will you continue to incorporate non-contemporary auction lots, such as the T-rex dinosaur or Salvator Mundi, into your contemporary art evening sales?

Yes, we will because our clients are thinking and acting less often through hermetic categories. Also, it adds visibility to our sales and broadens their audience. But we would never want it to become something artificial. Adding Salvador Mundi to a marquee evening sale made sense because we anticipated that bidding interest would not be limited to the traditional Old Masters field—and we were right. Selling the T-Rex in our 20/21 evening sale last October was also appropriate. We started our fall season post-lockdown with something exciting and refreshing, after such a challenging first half of the year for everyone.

 

Online auctions have great entertainment aspects too. Are you planning to have other platforms to view live your auctions?

Yes. We discuss and explore new innovations all the time. The most impressive one we piloted recently is the livestream of our Hong Kong sales via our WeChat mini-site. It was completely addictive and incredibly impactful, in terms of new audience reach and engagement. There’s more to come.

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