How a 248-year-old fine art business survives in the world of the internet

A Jeff Koons work being auctioned by Christie’s this month.
A Jeff Koons work being auctioned by Christie’s this month.
Image: Reuters/Eduardo Munoz
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Christie’s, the London auction house founded in 1766, is enjoying surging interest from consumers (and correspondingly surging prices) for fine art. The company hit a record $7.1 billion in fine art sales last year, and the activist hedge fund manager Dan Loeb has even used its success as ammunition in his campaign against its under-performing rival, Sotheby’s.

Christie’s has expanded into fast-growing markets like Asia and rolled out online bidding platforms. It has built out exhibition centers in the world where people can physically view art, complementing those with an online presence.

In an interview this morning with Quartz’s editor-in-chief Kevin Delaney at the New York Ideas forum (an event hosted by Quartz’s sister publication, The Atlantic and the Aspen Institute), Christie’s CEO Steven Murphy described this balancing act as “protecting the heritage of the company, yet changing dramatically to serve the customer.” He said that 48% of registrants for auctions last year were made online and that the company’s business is increasingly global. “The lead lot in the Shanghai sale two weeks ago was a Picasso, consigned from Europe, featured in Shanghai, sold to a European who bought it online,” he recounted.

But established auction houses like Christie’s are faced with another threat: online art marketplaces such as Artnet, Artspace, and most notably Amazon, which quietly launched a fine art marketplace last year.  ”Amazon is huge and has huge resources and good at what they do, so it’s a competitive threat. At the same time, without any complacency, I can say that Christie’s has an advantage which is, frankly, [that] it is Christie’s,” he said. “Anything we sell online will have gone through the entire Christie’s system of expert analysis, provenance, determination, condition reporting, [and] examination.”

Moreover, said Murphy, even though anyone with internet access can see images of the finest works of art, art hasn’t suffered the same fate as recorded music or books, where online distribution has pushed prices down. In fact, the opposite has happened.

“The ubiquity of fantastic images and the idea that you can sit anywhere in the world and pick up your iPhone and see the picture that is mentioned has increased the value of the original object, because there is only one of them,” he said. “To own and live with a masterpiece has become an even more valuable experience.”