The art market continues to adjust to the changes ushered in by the COVID-19 pandemic – and the technological transformations it brought in its wake. An Art Basel and UBS survey of 500 active, high-net-worth collectors in the U.S., the UK, Europe, and Asia indicates striking trends, revealed in 'Resilience in the Dealer Sector, A Mid-Year Review 2021', authored by Dr. Clare McAndrew, Founder of Arts Economics.

Among the most significant findings was that in the first half of 2021, millennials (now between 25 and 40) spent greater amounts and bought bigger-ticket items than in past years, despite financial crises brought on by the pandemic. In the first six months of 2021, millennials spent more than double the level of 2019, and they have far outpaced older collectors; their median spend so far is $378,000, which is more than three times their Gen X peers and close to four times what Boomers spent. (The collectors surveyed overall ramped up their spending 42% on average in the first half of 2021, reaching a tally of $242,000, which exceeds 2019 and 2020 spending in just six months.)

Moreover, millennials were most likely to spend north of $1 million on art. Though collections typically are larger with older collectors, a third of millennials (32%) have more than 100 works, whereas only about a quarter (28%) of those surveyed overall have such significant collections. Millennials also have the largest collections of all generations, with an average of 52 works.

The move toward transacting business digitally and purchasing works that collectors haven’t set eyes on in person seems here to stay. Thirty-seven percent of the market is now fully digital, and it shows no signs of abating, even though the widespread adoption of vaccines allowed societies to open up again. Many dealers are now finding new buyers – the lifeblood of any business – via online channels.

Art Basel spoke with three millennial collectors to better understand the picture painted by McAndrew’s report. Sarah Arison and Ed Tang, both in New York, and Sonya Yu, in San Francisco, discussed topics including their increased spending on art, the way the pandemic has affected their collecting habits, and the NFT craze.

Young collectors on the rise
Millennials’ strong position in the market is no surprise to Yu, who lives in San Francisco. She wears three hats professionally: she runs a creative agency and creative event space, is an executive coach, and edits a design and travel magazine focused on sneaker culture.

‘Millennials are reaching a stage where they have a lot of purchasing power,’ she says. ‘Gen Z hasn’t reached the point where they are significant players, whereas millennials are starting families and buying homes, and affecting a lot of markets.’ Indeed, millennials’ increased spending on art is in line with their rising luxury spending in other areas. In terms of travel, for example, a May report from TripAdvisor and Accenture found that more than a third of high-income millennials were planning to spend more than $5,000 on an upcoming luxury trip.

As with their peers overall, all three are spending more than pre-pandemic levels. Like many other collectors, spending more time in their homes has led them to think deeply about what art they live with and what art they want to spend time with.

The freedom to shop all over the world has spurred greater expenditure.

‘I definitely would say that since last March, we have accelerated our buying in terms of volume,’ says Ed Tang, an art advisor who collects in tandem with his husband of eight years. ‘Through social media, there is a sense of discovery that widens the scope of what we’re looking at. When in New York, I might just stick to, let’s say, the Lower East Side and Chelsea, and not go to Brooklyn, but now there’s no sense of geography to tackle.’

While all three are committed to supporting artists, Yu does also acknowledge an opportunistic dimension to the increase in spend.

‘There have been more opportunities and more offers, for better or worse,’ Yu says. ‘Strategic, long-term thinking by dealers and gallerists shifted to triage and short-term strategy to cover the difficulties. With online viewing rooms, galleries and artists were able to reach their clients so much more easily. Buyers’ requirement to see things in person was relaxed, and people lowered their requirements in order to get to the purchasing point.’

Digital art, digital channels
The elephant in the room in any discussion of art collecting today is the way that the much-hyped digital artworks known as NFTs, or ‘non-fungible tokens,’ have burst onto the scene, especially since the sale of a piece by Mike Winkelmann, who goes by the name Beeple, sold for $69.3 million at Christie’s in March. These works employ blockchain technology, the technology at the core of cryptocurrency. The collectors Basel surveyed overall may not be buying NFTs in bulk, but they are certainly open to collecting newer media. Digital, film, and video art now constitutes some 16% of their holdings.

Yu’s collection encompasses mediums including installation, painting, sculpture, and photography; she hasn’t purchased any NFTs (but has two that came to her as gifts). Among the artists she does seek out are Tauba Auerbach, Vija Celmins, Mary Corse, Rashid Johnson, Wolfgang Tillmans, James Turrell, and Rachel Whiteread. ‘I try to support female artists, as they are less likely to have representation, and artists of color,’ she says, ‘but it truly just has to make my tail wag.’

‘Right now NFTs are too coupled with cryptocurrency,’ she says. ‘There aren’t enough avenues for people to spend it, and NFTs give cryptomillionaires something to do with their money. If we can decouple the two, we can get to what’s valuable, which is the blockchain aspect and the way they can be used to put power back in creators’ hands.’

Tang calls himself ‘more of a traditionalist,’ who collects mediums like paintings and works on paper, while his husband is a bit more ‘adventurous,’ collecting conceptually oriented works such as installations. They own about 300 pieces, and the ‘pillars’ of the collection are formed by queer artists, female artists, and artists of color, especially Black and of Asian descent. Among them are Jadé Fadojutimi, Christina Quarles, Thomas Schütte, Henry Taylor, Salman Toor, Rosemarie Trockel, and Lee Ufan.

The couple haven’t found their way to collecting NFTs. ‘Of course I follow [this trend], and I know what it is. But I never like to stretch myself too thin. I stick to my lane and where I know what I’m looking at.’

Arison shares Yu’s skepticism.

‘My collecting has always been very personal, in that I would say that with 90% of the pieces that I own, I have met the artists, have spent time in their studios, and possibly partnered with them at PS1 or on mentorship programs. I’m very interested in the human side of the arts.’ Among the artists represented in her collection, which ranges broadly in terms of medium, are Zoe Buckman, Sarah Crowner, Katharina Grosse, Deborah Roberts, and Hank Willis Thomas.

To her, NFTs smack of thinking of art as a financial asset. ‘To me, that removes the humans from it and commoditizes artwork. It’s not the way I would choose to approach it.’

Like Yu, though, Arison sees potential in the new medium.

‘The fine art world has been looking for ways to engage the tech community, and has not been successful with that,’ she acknowledges. ‘And maybe this is a way to do that.’

If these three collectors haven’t engaged in NFT collecting thus far, a considerable amount of the spending of the collectors surveyed overall, 12%, was on digital art. Millennials spent a notable average of $20,000 on digital art in the first half of 2021. And the future is promising for the medium: nearly half (48%) of collectors are interested in buying digital works in the year to come.

What’s more, generally speaking, the younger the collector, the greater the percentage of their collection is digital art: while that figure is just 8% millennials, it’s 18% for Gen Z respondents, suggesting that, if those younger collectors continue on the same path, there may be many Beeples yet to be minted. 

All images taken at Art Basel fairs between 2019 and 2021.