The Secondary Art Market – Bev Doolittle’s Beyond Negotiations Sold Out & The Lunacy of Limited Edition Giclees
Brad Greek, a longtime supporter of my book, consulting and blog recently notified me Bev Doolittle’s latest limited edition piece, Beyond Negotiations, was sold out at Greenwich Workshop, her publisher of many years. No surprise in that news really. When I blogged about the work last month, the larger canvas giclee 350 piece edition was already taken. It was only a matter of time before the smaller canvas edition of 3,750 would also be no longer available at the publisher level. Together, the two editions represent $4 million in retail sales for unframed work. (Erratum, the edition of 3,750 was identified on my previous post as being on paper. That is incorrect, it is also a giclee on canvas.)
There may be other artists selling out large editions like Doolittle’s, but I doubt any are doing it as quickly as we’ve seen with Beyond Negotiations, which is her first limited edition published in eight years. Obviously, her fans, collectors and speculators remain enthusiastic about her work. The new piece is already active on the secondary market. The secondary art market and unlimiting giclees are the subject of this post.
In the art world, when limited editions are created, you have three levels of sales. The initial level is the wholesale or publisher level. It’s where a publisher will sell an artist’s work to its base of retail galleries and dealers. The primary market is comprised of those retailers who in turn market the work to their collectors and buyers. The secondary market is a mechanism to allow the resale of the pieces once they have passed through galleries at the primary level.
In the case of the new Doolittle, there has been an active secondary market from the outset of the release of the larger canvas edition of 350. In early July, it was being offered on eBay at triple the original price. A check there today shows that mania has subsided some with prices still at 150% of retail for "Buy It Now." I found one A/P listed, and didn’t know there were any offered. It was for the smaller canvas and claims to be #117/200 pieces. If this is accurate, that adds 200 pieces to the 3,750 total for the smaller canvas. I wonder how many other editions there are?
It brings up a point I cannot dismiss. In my humble opinion, the continuing use of the A/P (Artist’s Proof) editions for giclees is pure marketing hype and an insult to traditional printmakers whose techniques actually produce A/Ps. Given that Doolittle has spent the last few years working in stone lithography, one might assume she would be sensitive to this matter. Indeed, Beyond Negotaions started out as a stone litho, but was abandoned due to irreversible printing problems.
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The lure of financial gain is strong. Although I’d like to believe it, I can’t say with certainty I could resist making the extra money were I presented with the dilemma of whether to publish giclee A/Ps I knew would sell out and would add half million plus to the coffers, especially when there is plenty of history of publishers using the A/P numbering/marketing system to grow an editions of offset lithographs and giclees. That, however, is the subject for another post.
With the advent of P.O.D. (print on demand) technology that we affectionately portray as giclees) and eBay, coinciding with the public’s decreasing lack of interest in limited editions after being barraged with them in the ’80s and ’90s, the secondary market cooled considerably. There just wasn’t the active interest from marginal collectors and speculators to keep it hot. Not unlike the real estate boom and collapse we have just witnessed. But, it never went away, just pulled back to the hard core servicing the relatively small number of artists whose work never lost value in the secondary market. Doolittle was one of them. Pieces from her record shattering Sacred Ground edition of 69,996 pieces regularly sells for triple its original $300 price.
EBay, as it has done for antiques and all kinds of collectibles, took a big chunk of the market away from professionals who previously were the only ones with the means to find desirable pieces and who had a market to resell them. It effectively and forever changed the nature of the business for collectibles dealers, including secondary art market dealers. EBay is as close to a formalized market as the secondary art market has. Basically, it is a loose knit group of dealers who buy and sell pieces no longer available on the primary market. Many of them can be found in the classified sections of Art Business News and Art World News magazines. They continue to provide a valuable service for the industry.
While the prints that sell out quickly and generate lots of publicity are those that cause us to think of the secondary market, it also functions as a way for retailer stuck with inventory of low selling pieces to be able to dump them on the market, often at much lower prices than the original retail. Since publishers rightfully frown upon and often penalize dealers who undercut prices, this is a way for them to move inventory for which they have no market. So, the secondary market helps buyers and sellers find pieces no longer available at retail. It also functions to help reduce inventory of those pieces derisively categorized as "dogs."
In recent years, there has been a rise of a third type of dealer. The first being retailers, the second being legitimate secondary dealers who actually have the pieces they market in their possession or are in the possession of those consumers who are using them to sell the work for them. This third type is the online secondary dealer. Typically, this dealer does not own the pieces it is marketing, nor does it have a direct relationship with a consumer or gallery seeking to sell the pieces it markets. Essentially, it is trolling for popular works in the hopes of snaring a buyer and being able to find the desired piece at a lower price elsewhere and profit from the arbitrage.
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Joshua Kaufman, Esq. the intellectual property rights lawyer and columnist for Art Business News wrote a significant and important column on this subject titled, Secondary Market: Resource or Parasite? LookSmart’s FindArticles – The online secondary market: resource or parasite? Art Business News, March, 2005, by Joshua Kaufman. If you are thinking of reselling art using biographies, images and other materials purloined from other Web sites, you should think twice about doing so, read the article to learn how many laws you’ll violate if you do. Another good read is Alan Bamberger’s Retail Gallery Price May be More Than the Art is Worth.
If you are an artist with work in the limited edition market that makes it to the secondary market with vigor, you can consider you have done well by yourself and your work. Given the tremendous number of artists and plethora of limited editions floating around the art business, it is quite an achievement to find an active aftermarket for your work sold out at the publisher level. It is something to aspire to on one hand, and a source of aggravation and angst on the other for those who try and don’t succeed.
My advice is to keep your editions open and number them consecutively using an indelible method not easily altered (not pencil). If the work has value, the low numbers in all likelihood will be collectible despite however many are sold. It is pure conjecture on my part, but I believe Greenwich Workshop and Doolittle are leaving money on the table. If the image is as strong as it is believed and marketed to be, it would continue to sell well for years to come. Instead, they arbitrarily imposed a limit on how much could be made from the edition.
Let’s say Greenwich Workshop dropped the prices by 10% putting the total retail at $3.6 million or $1.8 million to the publisher. But let’s also figure it sold 20% more pieces over time, which ought to be doable given the interest in the piece. (Granted, it would take longer, but so what, nobody over there is clipping coupons.) The net result would be $4.32 million retail and $2.16 million to the publisher. And, it leaves open the option the piece might sell 50% or 100% more pieces if it were not limited. We’ll never know until someone with the power to make such a decision thinks it’s worthy of trying it.
Doing so would remove the malarkey of selling and naming a bunch of different editions. Does any sophisticated buyer purchase a giclee A/P edition and truly believe it to be superior in quality to a regular edition? Maybe the deluded, but not the educated, and educated print buyers are growing in numbers every day due to access to better information. They will still buy the A/Ps from a speculative perspective as long as the secondary market encourages the action, but not because they are falling prey to marketing tactics that somewhat surreptiously grow editons while obfuscating it’s happening.
I believe it’s time to rethink limiting giclees. Doolittle is no doubt a multi-millionaire from sales of her work, so we don’t cry for her bank account, but the point is not that artifcial limits on her reproductions have reduced her income. The point is how ludicrous would you think it if only the first 100,000 filmgoers got to see Gone With The Wind? What if Pink Floyd decided to only sell 1 million copies of Dark Side of the Moon instead of letting it freely run for an incredible 1558 weeks on the Top 100 list? How about Andrew Lloyd Weber saying, "Close Cats after a three-week Broadway run?" What if Ansel Adams’ magnificent oeuvre was available only in limited editions? How much would that have cost him and his heirs over the decades his open edition prints have undoubtedly sold in the millions of units? What a loss it would be to the millions of his fans who own open edtiions of his work.
Limited editons of reproductions, particularly those made digitally are artificially limited for marketing purposes only to make a few dollars more now and, I believe, at the price of making more later. Is this really a good idea? Think about it and please comment here if you agree or disagree.