by Joseph K. Levene
|Actual 2014 Online Art Market Estimate by Joseph K. Levene, The Fine Art Blog|
Skates overlooks at least $1 billion Online Art volume at eBay and Christie'sBased on recent data regarding 2014 sales released by Christie's and Auctionata, Skate's February 2015 analysis erroneously proclaims Auctionata leader of 2014 Online Art trading volume and overlooks $178 million generated by Christie's LIVE online bidders. Skate's overlooks estimates for Online Art sales volume generated by eBay and Sotheby's, yet provides estimates for artnet and Paddle8 even though published results won't be available until March.
|Skate's 2014 Online Art Market Estimate|
Proclaiming Auctionata leader in online art trading volume is misleadingAuctionata fails to provide specifics to support the $41 million realized in 2014. Although Skate’s Art Industry News report names Auctionata as leader in online trade volume with $41 million in gross merchandise value sold, no category or location specifics are detailed in either the Auctionata press release or Skate's. In addition, no details show trading volume generated from auctions, online marketplace and appraisals for which Auctionata charges an exorbitant 2.38% appraisal fee if the user submits 6 or more items.
|Tyeb Mehta (Untitled) Falling Bull |
Purchased on Christie's LIVE or $2.8 million
Why does Skates overlook the added value from Christie's LIVEThere is a significant added value realized by online bidders at Christie's LIVE even if users aren't the winning bidder. Christie's realized $178 million from online bidders in addition to $35.1 million generated from 78 e-commerce sales, +54% vs. the prior year. Christie's e-commerce platform has introduced buyers from 69 countries with 32% new to Christie's and 42% of these buyers under the age of 45 years. The highest priced lot via Christie’s LIVE was Tyeb Mehta’s (Untitled) Falling Bull sold for $2.8 million in the inaugural Mumbai, India sale, December 2014.
How can Skate's forecast Paddle8 and artnet sales when results not public?Skate’s Art Industry News report also states:
"While Paddle8 and artnet.com AG have not yet published their results, Skate’s runs a close tally of their online auctions and expects Paddle8 to report GMV of about $37-40 million for 2014, while artnet.com is unlikely to exceed $30 million GMV for 2014".Since Paddle8 typically ends all lots simultaneously, unless Skate's has multiple personnel that carefully watch each lot, we question how it is possible to determine which lots are sold vs. unsold. For instance, in the Paddle8 Perfect Match auction, 25 jewelry lots ended simultaneously at 5pm on 2/25/2015, of which 12 had one bid not meeting the reserve. Since all bids on Paddle8 are anonymous, critics question whether bids not meeting the reserve are real bids, chandelier bids or shill bids?
The rules for selling art online should be no different than offlineVendors who sell Art online should be held to the same standards as brick & mortar art sellers. Both Christie's and Sotheby's provide the same terms of guarantee whether online or off. In other words, in the event a buyer purchases a work of art incorrectly documented and/or counterfeit, for a four year period, the sale will be rescinded. The launch of Christie's e-commerce platform expands the Christie's potential buyer universe by providing a safe buying experience.
By comparison, documentation errors/omissions, Authenticity issues, incorrect condition reports and surprise shipping costs are reasons you should be cautious before buying Art Online at Auctionata, Paddle8 and Amazon/Art given limited return policies, especially when the vendor i.e., Paddle8, has not even inspected lots prior to listing.
Why did @Paddle8 not disclose #DamienHirst with 11 bids from edition of 100 http://t.co/RKgw4irqBp pic.twitter.com/c8bVJ8gr20
— The Fine Art Blog (@thefineartblog) January 20, 2015
@artnet, @DreweattsBlooms @Paddle8 did NO due diligence listing Counterfeit #KeithHaring sold @eBay pic.twitter.com/3vPL8KpMGD
— JosephKLeveneFineArt (@JKLFA) June 23, 2014
@Auctionata erroneously documents €120K Flower Painting in Online Art sale. http://t.co/FBVbvEwJii pic.twitter.com/hhi6aj7dhe — JosephKLeveneFineArt (@JKLFA) June 19, 2014
Why You Shouldn't Buy Art from Amazon @thefineartblog by #JosephKLevene http://t.co/QCjYlWm9H9 pic.twitter.com/K1mHFOm0LA
— JosephKLeveneFineArt (@JKLFA) August 24, 2013
Auctionata 2014 highlights boast 11 lots sold totaled €2 million, raising the question, show me the remaining €29 million ($33 million)!
According to Auctionata, revenue totaled €31.5 million in 2014, but how much volume traces to each Auctionata category? Unfortunately, Auctionata fails to breakout 2014 trading volume realized by category, location and appraisal fees.
|Convicted fraudster and former Auctionata employee Hao Ji aka Joseph Hokai Tang|
Auctionata boasts a team of 300 experts, one of these so called experts was convicted of fraud and is no longer employed by Auctionata. These experts evaluate property before lots are offered at auction or in the Auctionata online store; many Auctionata lots are misleadingly documented in a deceptive manner that often avoids key provenance and catalog raisonne details. A frequent pattern of deception at Auctionata includes repeated reference to vague and erroneous International auction results that have nothing to do with the respective item being sold, all without links and specificity. Or erroneous reference to catalog raisonne documentation when selling an After entirely inconsistent with the respective entry; stating a work is signed even though it bears a spurious signature; inaccurately reporting condition when the lot photos show the respective print suffers from significant light stain or a watch is defective.
Why did Auctionata lot details not disclose the Lesser Ury painting was previously sold twice at auction?Auctionata Search results indicate 1,323 paintings sold "recently", the highest price was €130K realized for a Lesser Ury painting. For reference, 197 paintings sold were priced below €2000, and the majority, 975 paintings fetched under €1000, considerably below the target price range of $5,000-$20,000.
|Lesser Ury Dame im blauden kleid im cafe|
Sold by Auctionata for €130,000
Most troubling is the blatant provenance omission since the Lesser Ury painting was sold twice at auction; in 2009 for $92,855 and in 1995 for $87,470. Furthermoe, provenance details in the December, 2014, were false as the painting was not in the same Private Collection since 1997.
Why did the Auctionata specialist not provide accurate provenance history? It took this user less that 3 minutes to locate the painting's auction history. The Auctionata buyer who paid $130,000 for this painting was sadly misled, further exacerbated by an Auctionata blog article titled "A Rediscovery" even though the Ury was sold and "discovered" in a 2009 auction, fetching about the same price fetched 14 years earlier!
"Lesser Ury is known and appreciated for his street scenes and coffee house images in impressionist style, the interior scene presented here shows one of the coffee houses on Berlin's boulevard band is arguably one of his finest examples of a café scene; comparable subjects fetch up to €180,000 on the international auction market."
|Lesser Fry Painting sold for $92,855, December, 2009|
The majority of lots offered for sale on Auctionata lack documentation clarity and include either vague support or no support. Too often lot sold exclude obvious information like the date of sale; the sale number; the lot number; vague references to comparable sales results, lacking specificity/accuracy and links that art professionals understand and require.
Attribution errors @Auctionata photography auction with 25 year guarantee http://t.co/FYZmwXM5IW pic.twitter.com/Csep1r8mnC — The Fine Art Blog (@thefineartblog) June 15, 2014
|Alexander Zacke, CEO and Founder, Auctionata|
4 Auctionata Myths
- MYTH 1. Art is not only a stable, but also a safe, investment. By safe I mean that afterwords, the item has appreciated in value. Art is therefore a long-term, stable and safe investment states Alexander Zacke, CEO and Auctionata founder.
- Unless you have a crystal ball, it is irresponsible and unethical for anyone to guarantee that art is a stable and safe investment, especially since the majority of art sold on Auctionata would not be considered collectible by knowledgeable art professionals and collectors. For a considered analysis on this topic, read Art as an Investment? A Survey of Comparative Assets by Melanie Gerlis,
- MYTH 2. Auctionata strives to meet the demand for a trusted online auction space that protects both the seller and the buyer from fraud states Ben Harley, International Managing Director.
Most of the so called "afters" sold by Auctionata are actually counterfeits no reputable auction house or art dealer would consider offering for sale, none considered safe. Furthermore, most of the "afters" sold by Auctionata, shown below, include erroneous, vague references to respective comparables sold at auction. most with no links.
|Selection from 131 "After" Lots sold but not covered by Auctionata Guarantee|
|Counterfeit After Andy Warhol sold by Auctionata with erroneous signature|
- MYTH 3. Most items sell in our auctions between $5,000 to $20,000 states Ben Harley, International Managing Director.
During 2014, the truth is Auctionata ONLY sold 193 lots priced between $5,000 to $20,000, out of total universe of 8,255 lots sold in Germany and New York, translating to 2.3% of total lots sold. Regarding New York sales, based on its limited Search, Auctionata sold 34 lots during 2014, of which 6 priced between $5,000 to $20,000. Surprisingly, Auctionata
sold 1,840 lots priced under $50, representing 22% of all lots sold in 2014, incongruous with the 2/15 press release stating there is a "demand in the mid-market range for art and luxury collectibles that is not being met." Every $50 lot sold by Auctionata has a greater administrative cost of at least $125. per lot; to avoid unnecessary financial ruin, it behooves Auctionalta to cease selling low end lots under $150., which will never be profitable even with a nearly 50% commission rate from buyer and seller.
Full disclosure, the Auctionata Search, does not include a way to search with a custom date range; accordingly,"recently sold" was used to generate 2014 sold items.
- MYTH 4. Our specialists vet and evaluate every piece sold at Auctionata.com and all purchases come with a 25 year guarantee.
10.5 Auctionata Terms of Guarantee exclusion: If an item’s catalogue description explicitly includes a caveat or restriction regarding the reliability of the information provided, then said information will not form part of the agreed characteristics. In this case, the purchaser will purchase the item at his own risk as far as the information in question is concerned. If a catalogue description explicitly refers to an item as a “copy” (e.g. as a “museum copy”), then the item in question will be deemed purchased as a copy and not as an original, thereby precluding any warranty for defects in this regard. If the catalogue description explicitly describes or designates an item as being "of doubtful authenticity", then said item will be deemed purchased not as an original but as an “item of doubtful authenticity”, thereby precluding any warranty in this regard. Inasmuch, neither the starting auction price nor the final hammer price of an item can be used to draw inferences about the actual characteristics or authenticity of that item.
Section 10.5 from the Auctionata Guarantee excludes Works designated as an "after", reproduction and/or copy; at least 131 Prints sold by Auctionata during 2014 are not covered by the Auctionata guarantee.
MYTH 5. It is inexpensive to sell your lots on Auctionata and getting valuations is free. The Auctionata website states "There are many advantages to selling on Auctionata that you simply won't find anywhere else. We provide access to an extensive network of international experts who will value your property."
Consignors to Auctionata face excessive selling fees that are hardly competitive and not user friendly. Think twice before consigning as you will be hit with 20% selling commission for all sold lots, either online or in its online marketplace; 2% storage fee if unsold lots are not picked up within 14 days; possible 2.5% insurance fee; shipping & handling fees; photography fees and most incredibly, an appraisal fee of 2.38%+ €119 if you want an appraisal of 10 or more items. Factor in the buyers fee and most lots have a commission rate yielding Auctionata 45-50%. And don't even think about being late which means that unless you provide payment within 7 days, you will be faced with 16% per annum late charge. Have second thoughts about an Auctionata consignment and face 25% penalty of the mean estimate for each consigned item you remove. The morale is proceed with caution before you sign an Auctionata consignment contract.The Fine Art Blog will release a more detailed analysis of Auctionata in the coming weeks.