Which role plays art really in asset management? Part 1: Collecting art is leadership - More then a historical excurse

 "Clement de Jonghe - The Printseller", etching, 1651, by Rembrandt van Rijn (1606 - 1669)

First of all – Art is not made for speculation and short run profit, it is made for passion, but a smart assembled art-collection enables a huge increase of the values of an asset portfolio. Yes, collecting art is still one of the most reliable investment possibilities, like everything made for passion. The estimated profit can be over average by far and the speculation risk is less than in stock exchange or real estate, because collectors have many chances to influence the development of artists and works.  Even, when we take a closer look on art-market, we will discover that, in spite of all other assumptions the art-market is very transparent.  More and more private Banks and Family Offices and their advisors are getting aware of that.

Is the role of art in asset-management the role of the sleeping princess?

Still there is something mystic on collecting art, which in general makes the finance world to turn around. Romanian artist Adrian Ghenie for example developed his quotation on the market in approximately 10 years 16-fold. Works that had been 20.000 Euro a couple of years before are now on the secondary market with more than 300.000 Euro. In 2018 the US auction market increased 18 %, in U.K. 15 % according to the Global Art Report of 2019 by economist Clare McAndrew, published in March 2019 by Art Basel and UBS Bank. Even in Corona-Crisis-Year 2020, leading auction houses as Christie’s, Sotheby’s and Bonham’s are announcing increasing figures.

In the meantime investors in real estate are satisfied with doubled revenue  in the same period of time. Risks that office-spaces, shops and even apartments can remain empty for a certain period or tenants who cannot pay anymore is all considered in the calculation. But in the same time they consider art-investment as risky. This preference is not based on facts, but on the experience of the most bankers. Last but not least, they have more experience in financing and failing financing of apartment with 180.000 Euro then with artworks of 180.000 Euro. Real estate market is larger, convenient and offers simple concepts, with monthly income. And if you need to unblock the investment, you can sell the apartment. What to do when you have to sell an art-collection? This is where collectors and banks with their art-advisors could jump in and control their risk by themselves.

Before we take a look on the chances collectors have to influence the development of artists, and which responsibility they have, we have to take a look on the deeper character of buying art and on its history. As always in life, if you want to understand the rules of the present, a look in the history can be helpful.

Buying art is not for everyone.  Art Collectors are leaders, ready to create their business surrounding, their lifestyle and ready to create the society they are living in. Most art collectors nowadays – and now let’s look on the upper middle class who buys art until ca. 500.000 Euro, are from families who live in that tradition for many generations.

So, how does an art-collector look like? Mature, experienced, with 60 more energetic than others with 30, enjoying life, travelling, luxury, exceptional places, fine hotels, best food, good whiskey, bespoke cloths, an everlasting version of Zeno Davidoff?  Sitting in heavy leather armchairs and enjoying life and celebrating art? And how we imagine a Count? Aren’t there lots of similarities?

The History of collecting art took different routes in the last 500 centuries. But they have surprising similarities. Dukes and Counts of the 15^th and 16^th Century, mainly influenced by the Italian Rennaissance and the ruling families as Borghese and Medici in Florence and Barbarigo and Loredan in Venice, supported artists and established huge art-collections as a symbol of status and power.

The big seafare nations of 17^th Century as Netherlands and England continued this tradition, where mainly the new upper middle class as merchants and ship owners copied the lifestyle and the leadership of the nobility. The Dutch merchants of 17^th Century financed the Golden Age even in arts, as they financed amongst others artists as Vermeer van Delft and Rembrandt van Rijn, who had been a ship owner and spice trader by himself. The development of enlightenment, first in England, afterwards in France, Germany, Austro-Hungary and more European regions caused that the lower nobility and the new upper middle class came closer together. And again, the upper middle class copied the lifestyle of the nobles, even when they had been “snobs”, which meant “sans noblesse”, without noble titles. The new class had maidens and drivers, silver cutleries and crystal chandeliers, valuable porcelain and finest wines and food. And they bought artworks. In the time of industrialization some of the upper middle class became nobles, and some lower nobles became entrepreneurs. The situation had been perfect for encounters and learning from each other. On that crossroad, the social levels mingled, which became a blessing for art-dealers and artists until the 20^th century.

Following this theory, it might not be surprising that the main hot-spots for art in contemporary Europe are London, Paris, Netherlands, Berlin, Vienna and Venice. All this places have a history of strong determining Imperial and Royal houses or in case of Venice, a tradition of influential families. In this places we have around the former courts many lower nobles and upcoming bourgeois ready to copy a life in nobility.

This contains not only to live in luxury, this means to think and act in long term, to take responsibility for decisions, for investments, for people, for artists and the progress in their careers. “Noblesse oblige” means as well to take care of artists and to support them, as well in benefit of the own collection. Latest now we can see, that collecting art is not just a business, but a noble life-style, which requires more a certain perception of life in dignity, then money, but it enables an increase of the family fortune. It remain, collecting art is a profitable passion.

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Next week in part 2 of this essay, we will take a look on the difference between investment in stock exchange, real estate and art.

Why social media marketing is not enough in visual art and what to do?

 

Thomas Emmerling, Director Kunsthaus 7B, Cisnadioara (Michelsberg), Romania

At beginning of the pandemic we hired a social media expert. We had been convinced that through the restrictions who forbid opening the gallery, it would be a better way to reach publicity. We had been thinking the whole world will be just virtually anymore, this will sustain after the lock-downs, we will reach more people – and it will be much cheaper than the classic way of acquiring new clients. We installed our web-shop, offered skype and zoom events, and collected likes from all over the world. Now after almost 9 months we have to admit, that we did not reach any new client through social media marketing. And we found out, that we cannot pay bills with likes and shares. As well our artists find out, that something is missing, in spite of all the global appreciation of their works, something essential is missing, something they could buy bread with. Our social media specialist gave us a lot of advices, to find the right hashtags, the right time to post, the right colors to post and so on. Photos, films, jokes, some content which is just indirect related to contemporary art from Central Europe. At the end of the line, our expert analyzes that we are not really in the market. Somehow we had the same impression. The chance to find new clients on social media is not determined by the market, but by chance.

My critic on social media should not sound as comments from frustrated guys, who just simply don’t know how to do it in a proper way. My critic should waken up the sector and encourage us to think, what aside social media is necessary for art-sales. Last but not least, social media can be a marketing instrument, but it can be not a sales-tool.

Surviving in world of contemporary fine arts without social media is simply not possible anymore. It is like the virus of the “Emperors new cloth” catched us all.

So what exactly remains to do? First of all, we have to be aware of the difference between marketing and sales. Marketing can only help to increase the awareness in your target group. But awareness in arts, even appreciation, is not leading mandatory to sales, there is another step, that has to follow. The process of sales has its own conditions.

I assume, that in spite of many social changes due to Covid 19, one important factor remains, that trust and confidence are the most important ones in art-sector. Dealers, galleries and artists trust a lot into social media, it seems that collectors are still hesitating and waiting, they don’t trust in the same intensity. Still it is necessary to win the confidence of the clients. If your clients are the persons, trusting you and believing in you, they will help you as well through hard times.

As a logic consequence of what we said until now, and in paradox to the vibe, everything should be online now, I think, personal contacts are getting more important in very near future. People are getting more and more individual and more and more privat nowadays. Art-Industry cannot ignore it. The times are over, when speechless, black-dressed unfriendly and arrogant people are “running” art-galleries, just proudly showing what they have. Even named galleries are suffering on that problem. The task of sales-staff in galleries is to find out the lifestyle of the client and what would fit the best to him and her. They have to remain friendly and behaving like good friends, even when the discussion is ending without deal. And they have to take the leadership in the sales process, not to let it up to the client, if they buy or not.

The future belongs to the art-seller, who is asking and understanding his clients and winning its trust, even when the instagram and facebook accounts are not showing the most likes in town.

Coming back to social media: Instagram & co. are helping artists to achieve a name amongst other artists, their main competitors. An art-gallery in a city with two million inhabitants might have 50, if it is good organized 10 relevant competitors. Being aware that social-media marketing is just entertaining, but not selling, I have to face the truth, that there I have one up to six million competitors. Even when you combine your social media activities with good content, it will be hard to break through. Meanwhile collectors buy a piece of the artist personality. This is transmitted more intensive in unique artworks than in uniform social-media trends.

Most of the big shots of collectors are not represented on facebook, some of them you even can’t find on the internet, because their access is filtered. They will not involve themselves in the unfiltered world of social media. Of course this idea has a big “BUT” button as well. The art-advisors, curators and secretaries around the decision-makers need social-media to inform themselves about the works, artistic CV, indicators for concepts or criteria to buy. In the front office of the collectors instagram and facebook are checked and filtered.

Does my friends, contacts, the people I am following reflect my self-understanding? Does it reflect the context I would like to be in? Who is my target group, whom I am following and who is following me? At the beginning you will be happy to obtain any follower; later on you should have the courage to clean your list from time to time. Of course in social media, masses are counting. But in opposite to TV-Stars, artists are not under the pressure to win everyone. Less is more, and it is more important that you build your marketplace in your target-group.

From our experience there are a lot of advices to give in social-media marketing, and I am sure other art-dealers have to give that as well: Prepare content for some days or weeks ahead, so you have it, when you will need it. Always be aware, that posting by its own is not enough. It is more important, to involve yourself into the community. Like, share, comment, communicate, take care of postings, stories and catch awareness with being there.

In order to have a strong presence, you have to be online permanent. You have to react and be one of the first to comment share like and repost. The permanent presence is not only in posting but as well in involving yourself into the community.

The threat is that small galleries with small capacities on human resources as well as artists marketing themselves will be selected out, if they are not following the rules. The algorithm will not remember them. But when you are just hanging on twitter & co, there is no more time for the real job of an artist, painting, as well as the real job of a gallery – convincing the right people and selling personally.

The Idea of the Danube Region in Contemporary Art

Guest-author Prof. Dr. Adrian Popescu, Sibiu, Romania, publicist  President of Lobbyart Foundation, founding member of German-Romanian University in Sibiu and for many years Vice-President of the the association of visual artists UAP in Sibiu,  about the idea of the Danube Region, the recent Oana Ionel exhibition "Secret Stories of Danube River" in Vienna and the Private Art Club ART 9TEEN in Vienna and its support for Romanian Contemporary Art. The text had been published first time on Prof.Dr. Popescu's facebook-site on 06th October 2020.

A resident of Sibiu supports the strategy of the Danube Region through cultural activities

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Surprisingly or not in times of pandemic, there are still commendable initiatives aimed at economic recovery. Among those who promote such initiatives, we are pleased to nominate the collector and art curator Thomas Emmerling, a cultural lobbyist and more, with an effervescent activity whether we are talking about Europe or America. Thomas Emmerling visited Romania in 2010 and since then he has created a cultural bridge starting from traditional art to the creations of contemporary art. In this framework of cultural exchanges, the exhibitions alternated, being organized in: Sibiu, Cisnădioara, Timișoara, Iași, Cluj, Tg. Mureș, etc. At the same time he held events in Hungary, Germany, Slovakia but also in Austria where since 2018 he has carried out several projects under "ART 9TEEN", as a result of his cooperation with the Viennese art entrepreneur and collector Alexander Varvaressos.

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"ART 9TEEN" is a new concept, much more than an art gallery - a private art club, where business and culture coexist perfectly. Art collector and art dealer Thomas Emmerling, who also resides in Romania, the initiator and director of "Michelsberger Kunsthaus 7B in Transylvania", based on an older project -related to the countries bordering the Danube- became the supporter of the Danube Region strategy through cultural activities . It is a welcome initiative that brings a new foundation of unity within the EU. The statement is supported by several arguments. The first would be the historical one and here, using archival documents, we invoke Nicolae Bălcescu who, on June 16, 1850, in the letter addressed to Alexandru Zane, referring to the "new continental order" launched a shocking proposal in that moment ... namely "Giovine Europa", formed on the basis of a "pact" ... a structure meant to unite the Greeks, Spaniards, Swiss, Romanians and the Slavs of southern Europe, "a Danube confederation to which Napoleon himself I visa ”. This option regarding the “federal plan” is also presented in the letter he sent to Ion Ghica, on April 6, 1850, in which he proposed that this federal form be called the “United States of the Danube”, for which he proposed that the governing act to be implemented by a "Federal Central Assembly". The second argument concerns the EU itself. Following the example of the “EU Strategy for the Baltic Sea Region”, the first such macro-regional approach, the EU Strategy for the Danube Region was recently relaunched, based on the efforts of stakeholders in the region to create a habitat in which all 115 million inhabitants to enjoy security, prosperity but also equal opportunities by connecting the Danube region to a network of transport, energy, culture and tourism.

 

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"Secret Stories Of Danube River"

This last aspect is highlighted in the exhibition "Secret Stories Of Danube River", in the creations of Oana Ionel, works exhibited by the curator Thomas Emmerling in the gallery in Vienna. The artist is known for her original concepts, which transcend political boundaries. Oana Ionel appeals to the memory of the river-symbol of Europe - the Danube, to tell a story about diversity, tolerance and respect for life. In a lyrical-abstract style, the painter describes the Danube as a cohabitation space that allows multiculturalism, from the Black Forest mountains to the Black Sea. "Rivers are alive and have a memory. Memories older than the peoples living on their shores are imprinted in their memory. Rivers do not care about the boundaries set by people ", explains the painter. One of the leitmotifs of Oana Ionel's paintings is the island of Ada Kaleh, which was swallowed by the waters of the Danube in 1971, following the construction of the Iron Gates dam. In Oana Ionel's painting, the island of Ada Kaleh is a constant presence and a symbol of diversity and respect for life. Congratulations to the Austrian curator living in Sibiu but also to the exhibitor who draws the attention of the decision makers that quick solutions must be found to overcome the pandemic crisis