Online Art Auctions Concerns on Making them Work
It’s apparent that the Internet is becoming an attractive and popular ground for businesses to use. Ebay created a virtual platform for buyers and sellers of various items to set the “World’s online market place“ but most people know it as an online auction system. Auctions are generally used to give value to items that have an ambiguous and uncertain value such as art, historic houses, prized dogs, jewelery, or anything so unique it doesn’t have a distinct value.
Traditionally, this kind of value creation or exchange was done in physical settings where interested partisans would gather in a group. The social pressure of physical presence can create insane prices simply because a bidder was caught under the fever of the game. This is often seen at art auction houses (Christie’s or Sotheby’s) where only a few bidders are fighting intently for the public’s attention or to own everyone by being the only one standing.
This kind of game is very attractive to people already in positions of high power (lots of money). Lately less people show up to these auctions, instead are represented by art dealers, hence the move to an online system. So what is the key to moving the art auctions online in a way that works? Will for instance Christie’s and Sotheby’s be able to successfully sell their items online in a way that satisfies them and their clients? Maybe this won’t happen until they notice significant bids are absentee bids or conducted over the phone.
The online system would diminish this social pressure, which can lead to lucrative results. It could also cause for “truer” prices of the value of art if the individual acts only upon his or her behavior. When bidding on Ebay, you don’t have a group of friends cheering you on and clicking that button- or do you? For a business, it’s easier since you’re leaving the transport costs to the seller and buyer. There’s probably more exchange since the Internet reaches out to more interested parties
By studying the structure of online poker games or online gambling, it can give some ideas. The result of gambling can sometimes be comparable to the uncertain outcome of an art auction. There are butterflies in your stomach, you sweat, you think you can outsmart the odds- this is empowering and exciting. If you can create the sensation of empowerment online then this can be the start to a successful art auction. Maybe the online stock game is another model to investigate.
Then we find the question of validity and certification of the identity of the online system and the artworks themselves (you can’t touch or feel the artwork), so how do you get people to trust your virtual identity? Christie’s and Sotheby’s have had a reputation lasting since the 18th century and people trust their authenticity.
With online art auctions you have to trust the system. First that your internet connection is fast enough for you to remain the highest bidder. Sometimes online art auctions are supported by the option of sending a proxy form or phone bidding to make sure your intentions are met to their fullest capacity. Until people get lazy enough to stay at home by the phone or the computer and are trusting of the system, online art auctions are at the risk of failure.
The goal would be to have Christie’s and Sotheby’s conduct online art auctions. The criticism at hand is their consignments involve such high worth artworks it’s hard to trust the online system. Alternatively, art auction houses don’t think the art will reach those high prices because of absent or weak social pressures. However, I have found myself many times sweating and re-adjusting my maximum bid on ebay for those concert tickets I really wanted. The problem is they want you to sweat like after a marathon.
One strategy is to start with mid-range artworks and build a trusted system and with time could accommodate for higher end art as well. There are websites like www.MutualArt.com that are good information hubs to see what kind of artist or artworks exist out there. Or work on creating a live interactive system that works and makes people feel like they’re part of something real much like Second Life. Imagine the possibilities!
