What growth potential do online auctions have in India? Experts weigh in

When online auction houses New York's Paddle8 and Berlin's Auctionata announced their plans to consciously couple last month, the art market went into a tizzy. After all, their global joint sales add up to $150 million in categories of art, collectibles and vintage luxury from a registered user base of nearly 800,000.

The Hiscox Online Art Trade Report 2016 reveals that the international online market has soared from $1 billion in 2013 to $2.64 billion in 2015. Seventy-one per cent of all collectors say they have purchased art online and 51.5 per cent, from artists they've discovered through Instagram. Global surveys show the number of online sales are increasing by about 7-10 per cent annually. Even homegrown auction houses such as Saffronart, Pundoles, Asta Guru and the Indian arms of Christie's and Sotheby's are riding the e-commerce wave. In 2000, the market size for modern and contemporary Indian auctions globally was below $2 million. In 2015, it was estimated to have reached $100 million, according to industry insiders. Taking art online clearly seems commercially viable.

Convenience of a click

Online auctions usually take place over a 24-hour or a 48-hour period. Multiple artworks, or lots, as they are called, are combined into groups. Each group has a clock that counts down the bidding time from start to the end. An online transfer of funds, much as in an e-commerce transaction, by the highest bidder seals the deal.

Saffronart CEO Hugo Weihe says this mode of selling allows more scope to generate buzz around an artwork. "We can publish costs, additional information, videos about the artwork and the artist, background stories with external links, e-catalogue. Our mobile app lets you tap into an auction at a particular time from any place." Also in the offing is a virtual space for potential buyers to 'see' how an artwork would look in their home.

Dinesh Vizarni, co-founder of Saffronart, the auction house that pioneered online bidding in India and also runs StoryLTD for sale of online collectibles, says the high resolution images of artworks on the site saves buyers the trouble of visiting a gallery to inspect them. "Issues with internet connectivity and speed have been resolved after tremendous feedback from many buyers who feel empowered buying art online," says Vizarni about the leap of faith he took when launching Saffronart in 2000. Today, Saffronart ranks 15th on Hiscox's global market leaders of online art. "The market wasn't transparent and information on artists was difficult to access. Offering the same level of trust and comfort as that from an art gallery was a challenge. We overcame this by holding art exhibitions around the world."

Christie's Sonal Singh, who heads the South Asian Modern + Contemporary Art department, says that clients enjoy multiple visual images of the lots, quick transaction processing, high-quality shipping and access to specialists. "Over the past four-and-a-half-years, we have increased the number of online sales to 79 per year, selling over 7,000 lots in 22 different categories," says Singh. She adds that the online-only platform offers a quicker turnaround and setting up and launching a sale can be wrapped up in a month. "Online auctions allow us to test assumptions and experiment with what clients want." Mumbai-based Asta Guru ranks 40th on Hiscox's list and has gone from two auctions to six this year with about 80,000 followers on Facebook. "It's not feasible for our collectors to come down from Lucknow, Nashik, Surat, Bangladesh, New York, Singapore or London. If you are an avid collector, you are familiar with the strokes," says co-founder Tushar Sethi.

Going, going, gone

Virtual auctions are good platforms for wine, jewellery, photographs, vintage luxury goods such as handbags, decorative arts, prints, Chinese works of art, artworks by Andy Warhol, Pablo Picasso, Alexander Calder, Richard Serra and Francis Bacon, says Christie's Singh. Among paintings, the modernists and masters are still popular, adds Weihe. "You can get a Souza sketch for a few lakhs, which is an easy way to come in at lower price points," he says. Unless it's old, vintage, a brand or belongs to a royal family, jewellery has negligible online buyers. "It's a 10 per cent increase with every bid. So why would someone pay a 40-50 per cent premium for a piece of jewellery when they can get it replicated by a local jeweller? Besides, Indian jewellers are fantastic in copying jewellery from auction catalogues," says Sethi. Watches and pens, he feels, are relatively untouched.

See it to believe it

The online space has proven to be a game changer for middle-market art goods. The higher end art market also includes previews and sit down dinners for prospective buyers to physically view the works up close. "For higher priced objects and artworks, it's still viewing the piece in flesh; handling it, holding it, walking around with it and getting a feel for the three dimensions and volume is important," says auctioneer Mallika Advani of Pundole's, an art gallery that entered the auction space five years ago. "That's not possible online."

Buying art online also requires the buyer to be vigilant. "There's no harm buying from a legitimate portal that provides documentation, provenance report or authentication certificates. But the condition of the work, whether it's damaged, is what you need to be careful about. I always see the work in person before acquiring it," says architect and avid collector Ashiesh Shah. Art consultant Farah Siddique seconds Shah. "As an advisor, I personally examine (an artwork) actual resolutions of photographs and prints and colour for paintings."

Moreover, the magic and palpable excitement of a live auction is impossible to capture through a computer. "The building momentum of spirited bidding in the auction room comes to the fore in live auctions," concludes Advani.