This study identifies and analyses challenges and opportunities of commercial art galleries in the German-speaking market following the Covid-19 pandemic. The sector has already been a challenging playing-field with a growing market division between big and small players, many of whom were financially dependent on art fair participations. Through Covid, many operations had to be shifted online, and the traditional reliance on personal meetings and relationships needed to be mitigated.
This thesis defines main changes to galleries’ business models and assesses the impact of Covid. Objectives further include evaluating business opportunities and trends such as regionality or sustainability. The aim is to bring clarity to the most recent developments from an academic perspective while also offering practical applicability for arts managers, specifically gallerists and art market consultants. This thesis contributes to the literature by filling a currently existing gap through assessing the impact of Covid on galleries and by presenting an analysis from a managerial perspective. To achieve the objectives, a combination of methods is used, synthesizing academic literature, quantitative market reports and qualitative interviews with sample gallerists.
Overall, the falling away of physical contacts has proven to be the core challenge for a sector heavily relying on personal relationships. Covid’s impact varied across gallery types (small, mid-size and large), depending on their cost management and on how reliant each type had been on fair participation. The general shift online offered more opportunities for smaller galleries and/or the lower-price range; crucial factors are branding, conversion and targeting newer, younger audiences. Generally, however, online sales offerings underperformed and the overall role of digitisation for galleries is overrated. With younger collectors being more accustomed to buying online, a certain generational shift is however likely to happen. In the near future, the combination between interpersonal trust and trust instilled through online branding will be a decisive factor for winning newer collectors. Trends such as regionality or sustainability are unlikely to play a stronger part in the gallery sector.
II. Table of Contents
I. Abstract
II. Table of Contents
Chapter 1: Introduction and Research Question
1.1 Research Question: How will the Gallery Sector Develop?
1.2 Objectives: Assessing the Current Situation and Evaluating Trends
1.3. Hypotheses: Increasing Competition, Importance of Brand Value, and an Overestimation of the Digital
1.4. Literature Review: Understanding the Status Quo
1.4.1 Galleries' Position within the Creative Industries
1.4.2 How Galleries do Business
1.4.3 Key Dynamics Relevant for Galleries' Operations
1.4.4 Impacts of Covid: First Prognoses
1.4.5 Market Influences and Trends
1.4.6 Open Questions not Covered by Current Literature
1.5 Methodology: Combining Methods to Achieve a Full Picture
Chapter 2: Identification of Challenges and Opportunities
2.1 General Recession
2.2 Areas that were Especially Affected
2.3 Current Challenges and their Meaning for Galleries
2.4 Current Opportunities and their Meaning for Galleries
Chapter 3: Discussion of Developments and Potential Future Strategies
3.1 Business Models: The Lasting, but Minor Role of the Digital
3.2 Evaluation of the Online Space: Gallerist Perspective
3.3 Evaluation of the Online Space: Client Perspective
3.4 Evaluation of Trends and Expectations for Wider Sectoral Developments
3.5 Depiction of Market Division Correct yet Misrepresenting Galleries' Operational Needs
3.6 The Art Fair Dilemma as a Main Operational Challenge for Small and Mid-size Galleries
3.7 Conclusion: Overvaluation of the Digital
4. Bibliography
4.1 Academic Literature
4.2 Quantitative Data
4.3 Qualitative Sources: Interviews
5. Appendix
5.1 Interview Questionnaire
5.2 Interview Summaries
5.2.1 Arne Ehmann
5.2.2 Nicole Hackert
5.2.3 Kristian Jarmuschek
5.2.4 Christian Nagel
5.2.5 Robert Morat
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