Have you been to an art gallery lately? Probably not and that’s the problem. The gallery showrooms, the ones still open, have been uncomfortably quiet since the art market fizzled in the early 1990s.
Notably absent from the gallery scene are the corporate art collectors, whose welcome presence was a major phenomenon of the “go-go” art market of the mid-1980s. From the mid-’70s to the mid-’80s American corporations were responsible for between 10 and 20 percent of all gallery sales. Now it is less than 5 percent.
Corporate America’s involvement with art collecting was not accidental. It took decades of effort by dedicated professionals to convince businesses that art collecting was a valuable way to decorate the work place, connect with the community on a cultural level and invest surplus cash. What went wrong?
First, the art world fell prey to one of the business world’s deadliest sins–the worship of premium pricing and high profit margins. As demand for artwork increased in the early years of the boom, and one sellout show followed another, many art dealers were quick to raise prices, often doubling them every two or three years. Buyers were told to “buy now” before prices rose even higher. Was there no end in sight? The names of corporations whose art collections were outperforming their other assets was a litany of the time. The words “Chase Manhattan Bank” became a mantra for legions of corporate art consultants. Soon all but the deepest pockets were priced out of the market.
Serious professional corporate buyers became disenchanted, and the youthful newcomers (tomorrow’s deep pockets) were treated with condescension.
During the height of the art boom, corporate collectors were encouraged to acquire artworks by the hottest artists for display in work places. Canvasses painted white, artsy slogans in neon or graffiti, or heaps of industrial detritus were purchased in abundance. Though the cognoscenti may have swooned in admiration, the more pragmatic working public has never acquired much of a taste for these offerings. And though this was a minority of the works purchased by corporations, it was a highly visible minority.
Beginning with the stock market crash of October 1987, the economy entered a period of turbulence and corporate culture became very different from the previous decade, where flash and glitz were the order of the day. The modern business now looks comparatively lean and levelheaded; it eschews lavish displays of wealth and power. Amassing large art collections seems inappropriate in today’s business climate.
Uncle Sam has also played a role in cooling the climate for art. The National Endowment for the Arts created a furor with its decisions to fund artists whose work was seen as bizarre and offensive such as the crucifix floating in urine. The NEA, while attempting to help the arts, actually succeeded in associating the art world with self-indulgence and government waste, pitting the art world against middle-class values in a battle for the soul of the nation.
Because of these events the robust art market declined precipitously in the early 90s. Many companies found that their art collections had lost their former value, with high priced artworks fetching as little as a third of their prices during the late ’80s prices. And with the corporate climate for art turned chilly, stockholders asserted that art collecting was adding nothing to the value of their stock. With the cost of insuring and exhibiting artwork on the rise, many companies such as IBM have found it easier to simply jettison their art collections at auction.
Is corporate America gone from the art market for good? Probably not. This abandonment of art collecting has greatly increased the selection, driven down prices and made art dealers and artists are more eagar to please, serious corporate buyers.
