Russian art is not integral to the world art market, and it is secondary to the art of Europe, USA, and even China. The problem is, Russian artists neglect to promote their brands and are not willing to treat their art as business. Nevertheless, Russian art has great potential to move to another level, but that requires new artists, new producers, new galleries, and new investors. Paradise Art talked to the founder of Gridchinhall gallery Sergey Gridchin about the trends in the Russian art.

Paradise Art:

You have been in Russian art business for many years. What do you think happens with Russian art now?

Sergey Gridchin:

So far Russian art remains at the margins, and there are reasons why. Art depends on economics. Given that we are not among the leading economies in the world our art market size is relatively small. In the 1990s after the Soviet Union’s collapse, Russian artists were euphoric. There was a newly developed interest from outside to yet isolated country, which allowed them to sell their artworks. The prices were ridiculous for the buyers, but significant for the sellers. You could sell a painting for $200 and live on that for a long time drinking with your friends.

“The fat 2000s” brought the growth of wealth and people began purchasing art. Everything was selling like hotcakes, and the prices were going through the roof. It seemed like Russian art market would exist further on and there would be no need to build into the international infrastructure because one could earn a good living here in Russia. The illusion faded in the wake of the financial crisis of 2008. The demand for art has crashed. The local art market was never created, and Russian artists have barely entered the international one. As a result, no one knows us there.

Сергей Гридчин

Paradise Art:

What infrastructure are you talking about?

Sergey Gridchin:

You need to understand that art industry is built up there, abroad, including all functioning components of the chain: art schools, galleries, museums, auction houses, non-commercial institutions, and marketing mechanisms. If you can’t fit in, you don’t exist! If nobody knows you, nobody buys you. It turned out Russian artists were left behind this structured art market. Look, the financial crisis of 2008 has hit European economies more than the Russian economy; however, their art market has recovered soon, whereas Russian art market has ceased to exist. Money is a crucial part of the art industry. It is impossible to evolve and create large-scale projects without them.

Сергей Гридчин

Paradise Art:

You are so persistent about the necessity money as if it is not obvious enough or doubtful.

Sergey Gridchin:

Strangely enough Russian artists don’t understand it. I keep hearing them demanding to provide them with commissions and exhibitions. Someone always owes them something. They are reluctant to perceive art as a business. Moreover, it feels like they treat “commercial art” with a certain contempt.

In economically developed countries besides commercial art market, there are foundations aimed to support the artists. You can apply for a grant, and if your application meets the requirements, you get the funding. The foundation has money and mechanisms to ensure public scrutiny of the targeted use of funds. Such institutions are very important for young unknown artists. Someone spends all life seeking foundation grants producing art objects not oriented for sale.

Сергей Гридчин

Paradise Art:

This is what should happen on behalf of the artist – “the issuer of an art object.” But there are also investors buying art in the hope that their acquisitions would increase in value in future. What would Warren Buffet of art world say to them?

Sergey Gridchin:

He would say: “You are smart not buying Russian art!” Why would you pay for art objects produced here? How to set a price? Regarding price formation, nothing has changed here since the 1990s: artworks worth as much as the buyer is willing to pay. The idea of a fair price doesn’t even exist. Of course, you can buy whatever you like, hang it on the wall and enjoy. But when people spend considerable sums of money, they want to know what for. That is when art becomes not just a treat, but an investment. Therefore, turning art object into an asset, one can possibly sell at a higher value than bought. How to determine a price?

The price for the most commodities such as oil, metal, wheat or securities is set at the stock market. Art objects are the same commodities: auction houses are their stock markets. The international database Artprice allows tracing the history of a particular artist and his or her works, how they were traded and the price dynamics. Based on this information the estimated cost of a certain artist is determined. There’s a range of art products for different segments – for the elites or more humble buyers. In London I’ve seen the works of the same artist targeting different consumer abilities. This system has been working for a while there, and we are trapped in the swamp here.

Paradise Art:

So, what do we do now? Urgently develop the national art market or try to fit in the international? Isn’t it too late?

Sergey Gridchin:

Like in business there’s a local market, and there is a global market. If you want to join the currently existing infrastructure, you should follow the rules! It is possible to build the same system here in Russia, and we have the potential – we are 140 million people with the potentially large economy. The point is, the local market must meet the primary market already existing abroad. As well as within other branches of the economy, at first, national companies grow locally and later turn from private to public. Next, they decide where to place IPO, here in Moscow, in London, Hong Kong or New York. That applies to the art world: it is a public sphere and artists should choose where to trade – here or abroad. That is why it is necessary to build art infrastructure here. It is possible and not so difficult to do.

Paradise Art:

What does it take?

Sergey Gridchin:

All market players should be interested. But I sense the lack of the interest. It comes from the Soviet Union: on the one hand, everybody wants money, on the other hand, they ignore or despise market mechanisms.
How is art different from fashion industry? There are specific features, but basically, it is the same business relying on brands. Their capitalization depends on their recognition. As long as we treat art as a business, we should follow the rules of business, which includes promotion, marketing, product, etc. However, Russian artists wouldn’t promote their brands. So, I have a question: why in the world they would increase in value? You can buy their artworks, but can you sell them?
Apparently, an artist shouldn’t do marketing (otherwise, when to make art?). It is work of a particular kind requiring special skills. But an artist must recognize the need for it and hire relevant people. That is what we are looking at.

As a result, art collectors would develop their investing strategies and decide who’s worth buying, how to value the artists, how to hold interest to the artworks already in their possession.
Russian art market needs a full reboot and requires new artists, new art dealers, museums, auctions, etc. Well, the situation has already been changing.

Author: Gershon Kogan, 10.06.2018

Syuzanna Kamara

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