The Art Newspaper case study

This case study describes the business model of The Art Newspaper. The Art Newspaper is an international newspaper updating readers monthly about happenings in the art world. Anna Somers Cocks opened The Art Newspaper for Umberto Allemandi publishing house in 1990. The Art Newspaper has many sisters’ editions like “Il Giornale dell’Arte” in Italy, “Le Journal des Arts” in France, “Ta Nea tis Technis” in Greece and others. The Art Newspaper has a printed version that has a newspaper format as well as an online version.

The Art Newspaper International edition includes two different sections covering various topics on visual arts, as well as changes in the art market, laws and cultural regulations. The International edition of the paper has the following structure: Section 1 covers international cultural news (Subsections: Museums, Exhibitions, Conservation, Comments & Analysis, Features, Books, Media, Calendar and Regulars) across the world and Section 2 covers the international art market (Subsections: Art Market and Fairs & Auctions). Each subsection is covering news from United Kingdom, US & Americas, Continental Europe and the Middle East.

According to Artnet, wealthy Russian editor Inna Bazhenova bought the paper in 2014. Previous owner Umberto Allemandi commented that Inna has inside knowledge as she worked in the paper for 10 years and has a new vision for digital development of the paper.

Organisational Strategy and Aims

The mission of the Art Newspaper is to deliver news from the international art world to its readers. The publication is aiming to provide objective and unbiased material.

One of the main objectives is to separate commercial and non-commercial worlds. In order to achieve this, there are two sections in the newspaper: cultural and economic.

Another important aim is to cover different types of art and many periods from the art world: anything from fine art and decorative art to collectables.

Finally, another objective is to write clearly using ordinary English with minimal academic language. The idea behind it is to make the Art Newspaper accessible to every type of reader with any artistic background.

The market of art magazines and newspapers is rather competitive, especially with the rising popularity of online bloggers and social networks. The main problem that the industry is facing is the decreasing popularity of printed versions and increasing numbers of online readers. Magazines writing about art should adapt to new trends and think of different ways to attract readers.

There are a lot of different publications about art; however, the majority of magazines are covering either specific geographic area or a niche market or a specific historical period. For example, “ArtReview” covers the international contemporary art market; “Art&Antiques” covers mainly Old Masters and antiques; “Sculpture” covers all forms of sculpture in contemporary market. However, those publications are not direct competitors of The Art Newspaper because they are more targeted than The Art Newspaper.

While ArtNews, an international publication that covers different areas as well as periods, can be seen as a direct competitor to The Art Newspaper. ArtNews is the oldest publication in the art market and has a larger circulation than The Art Newspaper. The ArtNews has more than 180,000 compared to more than 100,000 readership of The Art Newspaper publication family. This might be explained by the long history of ArtNews, the publication was established in 1902: ArtNews might have an established loyal reader base. Even though ArtNews is almost 90 years older than The Art Newspaper, they have a more modern approach than The Art Newspaper. For example, ArtNews is present on a wide range of social media platforms: Facebook, Instagram, Twitter, Google and Pinterest compared to only Facebook and Twitter for the Art Newspaper.

The main strength of the organisation is human capital. Experience in the art world as well as writing about the art world means The Art Newspaper stands out and delivers high quality news.

Another valuable resource is the brand name. The Art Newspaper is a trusted name and it is respected in the world. Newspapers opened in Russia and China under this brand name are successful partly due to the reputation of The Art Newspaper.

Employees exclusive Contacts in the art world and access to private views allows them to gain insider knowledge that makes articles more interesting.

There are a lot of people involved in the process of realising the idea into production to delivery so that different social groups can benefit from it.

Stakeholders are people or institutions that can be positively or negatively impacted by actions taken by the Art Newspaper and its production. There are different groups that can be identified as stakeholders:

  • Employees. All full time and part-time employees are the stakeholders because they are creating the paper and their financial and emotional stability depends on the success of the paper.
  • Readers. Different readers also are interested in the newspaper; students and researchers can use it for educational purposes. Collectors can read the reviews on the art fairs and explore the international calendar for upcoming fairs. Readers from art galleries and museums are also interested in the paper as they can learn about their competitors. The general public can keep up with international art news.
  • Advertisement. Companies placing the advertising on the pages of the newspaper are also stakeholders. The advertisement through the Art Newspaper is a part of their marketing strategy and the reputation of The Art Newspaper will reflect their brand.
  • Organisations mentioned in the newspaper. Museums, galleries, art fairs, auction houses are also interested in the Art Newspaper as their reputation may be affected depending on how they are reviewed in the paper.

International correspondents can be considered key suppliers. Correspondents write articles and then send them to editors for proofreading and printing. Correspondents work all over the world to create the international issue – they work part-time and combine other jobs with writing for The Art Newspaper. Without international correspondents the international scope of the paper would not be possible.

Key buyers are the readers of the Art Newspaper. The range of readers is wide: keen exhibition viewers, museum professionals, collectors, artists, lawyers specialising in cultural property issues, arts administrators, dealers, auctioneers as well as students.

The target group of the Art Newspaper is diverse: some readers are interested in the newspaper to keep up with news because they work in the art world; the second group of readers is interested in the newspaper only for entertainment or personal interest. These two different groups of readers have different needs: people reading for educational and work purposes need more academic information; however people reading for pleasure need less academic and technical language. Hence, the Art Newspaper has to find a balance and satisfy both types of customers and which is why the Art Newspaper uses less technical language.

In order to have clear understanding of The Art Newspaper business model SWOT analysis is done to indicate strengths, weaknesses, opportunities and threats for the business.

Untitled

Marketing Strategy

The Art Newspaper does not have a very strong marketing campaign as it relies more on reputation and word of mouth. However, there are ways the paper is being promoted.

One of the ways to advertise the newspaper, The Art Newspaper enters different media partnerships with art fairs, for example, The London Art Fair, (e)merge. The terms of agreement are not known to the general public, however, assuming that it is a general media partnership, it implies that the logo of The Art Newspaper goes onto leaflets of the art fair and the newspaper covers the art fair and participates in conferences.

Another way how The Art Newspaper advertises itself is by putting comments of respected people of the art world on a banner in the paper itself.

The publishing industry is very competitive and the newspapers and magazines have to differentiate to survive. The Art Newspaper stands out from competition in the following ways:

  • Unique format for the art press. The Art Newspaper is not a magazine and does not have glossy pages; it is printed in old-style quality newspaper format. Psychologically, the format resembles high quality trusted publications like the Times, which attracts readers and builds trust.
  • Creating stories, not only reporting them. The Art Newspaper reports news and trends in the art culture and the art market, written by international correspondents. However, editors also create stories and investigate particular stories. For example, one of the journalists has gone undercover to meet tomb-robbers in Italy and found out about the economics of the trade in illicit antiquities. This approach guarantees that The Art Newspaper has exclusive stories that are not covered by any other publication.

Sales and pricing strategies are very similar to any newspaper in publishing. There are three ways in which The Art Newspaper reaches its readers:

  • Through bookshops. The paper can be found on the shelves of bookshops such as Waterstones or the magazine area in Selfridges. The Art Newspaper targets educated people interested in art and the paper is sold in places where they would shop. Hence, The Art Newspaper does not appear in 24/7 “off licence” retails.
  • Through selling individual issues online. The reader can buy current issue as well as past issues individually or as a subscription pack of twelve issues through the App for iPhone or iPad. This is attracting a younger readership, who do not want to store massive papers and magazines at home, but want to stay updated.
  • Subscriptions. The deal of twelve issues is available both online and in printed version. The price for twelve issues is paid instantly and on average price per issue is cheaper than buying each issue individually. This is the typical pricing strategy for newspapers and magazines to encourage readership and develop a loyal customer base.

 

Conclusion

Under a new leadership The Art Newspaper developed an online presence: they launched the App for Apple products (iPhone and iPad) and the website is under reconstruction. However, they have not covered the Android platform yet, which limits the number of readers. The range of social media is limited as well and is not as extensive as their competitors. In order to be more competitive in the market The Art Newspaper should take the opportunity to develop a stronger online presence.

The main risk that The Art Newspaper faces is the decreasing popularity of the printed press. The number of printed press is declining dramatically across different industries. This indicates even more strongly that the company should adapt to a new era of technology and develop online paper.

Another way to develop the company is to increase interaction with readers by either creating an educational programme, for example “How to write about Art” or “How to review the art exhibition” or by introducing “Questions and Answers column”. By engaging more with the readers The Art Newspaper will increase awareness and therefore circulation.

More than this, the paper can introduce the Limited Special Editions based on particular themes, mediums, retrospectives or periods. The Art Newspaper already has general art coverage, but this will attract niche readership.

To sum up The Art Newspaper is already a valuable source of information in the art world, however it has several ways to reach its potential.

“Good vs Evil” by Maurizio Cattelan

This is the analysis of Maurizio Catalan artwork and its performance at Sotheby’s Contemporary Art Sale 2013.

Maurizio Cattelan is an Italian artist, who was born in Padova in September 1960. He is famous mostly for his sculptures and installations, but he also works with photographs and acrylics. Maurizio uses a very wide range of materials in his work such as steel, wood, papie mache, glass, stuffed animals, taxidermized animals, skeletons and wax.

Maurizio Cattelan is a commercial artist, who does not consider himself as an artist. In his interview published in 2000[1] he said “I am not an artist. I really don’t consider myself an artist. I make art, but it’s a job.” This statement and idea of art as solely a job may be a part of marketing strategy and image creation. This self-criticism and doubt may be attractive to customers and by buying his art consumers admit the talent of Cattelan and his artistic qualities. The range of different business moves for profit support the idea of artist being commercial, the artist participated in the advertisement, for example the advertisement of Absolute vodka in 1997[2]. He also issued a magazine Together with Dominique Gonzalez-Foerster and Paola Manfrin called “Permanent Food” (1996 to 2007)[3]. Three years later Maurizio introduces new magazine and manages magazine “Toilet Paper”, bi-annual publication and illustration-based, since 2010[4].

Maurizio Cattelan is placed at a high end of the market and he is well known artist, with strong established reputation. He had travelled with solo exhibitions all over the world and had some works presented in the museums and galleries. The most significant and most recognizable are Centre Georges Pompidou, Paris; Project 65 at the Museum of Modern Art, New York; the Tate Gallery, London (1999), the Museum of Contemporary Art, Los Angeles (2003). Maurizio Cattelan also participated in the Venice Biennale (1993, 1997, 1999, and 2002). His works are also a part of important collections throughout the world such as Rubell Family Collection, Miami; Guggenheim Museum, New York; Castello di Rivoli, Turin; the Dakis Joannou Collection, Athens and Fondation Pinault, Paris.[5] The more popular the artist is the more cultural, hence, market value is added to his works. Therefore, the long list of the galleries and museums suggests that the prices for his art are relatively high.

This overview of the artist, his background and key points of his career may help to analyze and understand his position in the market, as well as to determine where in the market fits the chessboard “Good versus Evil”. In this section I am going to outline the structure of the market for Maurizio Cattelan, determine his works’ price range and summarize key points.

The record price for Mauricio Cattlans’ work was achieved in 2010 for untitled sculpture of the man in the hole made from wax. It was sold for hammer price of $7,000,000 (4,710,000 GDP), which was strongly over the estimate of $3,000,000 – 4,000,000 (2,020,000 – 2,700,000 GDP).[6] Maurizio Cattelan has some works that are sold for millions and were underestimate, such as “Not afraid of Love” sculpture, “The Ballad of Trotsky” or “La nona ora”.

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The table above represents the price range of the average data for the hummer price from 2000 to 2012 as steps of 10%. We can see that the half of the lots was sold for less than $51,218, which is relatively low. However, if we are looking at the top end of his works, we can see that 10% of his works were sold somewhere between $550,000 and $7,000,000 which is relatively expensive.

From the chart bellow it can be seen that Maurizio Cattelan accumulates his wealth and if the outliers (such as 7 million sale in 2010) are omitted we have a decline during the economic crisis, but general trend increases overtime. This means that more works are being sold or fewer but at higher prices, and the more art works are distributed the more fame the author gains and hence, the prices may be expected to keep rising. This means that the Cattelans’ works may be considered not only as art but also as investment. The investment might not be bringing return in the very short run, because the prices rise slowly and the market is rather stable, but in 10-20 years it might bring a significant return.

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All the data provided starts from 2000, hence the analysis is limited and it can not be determined when the market started to rise or how the artist was developing his niche in the market before 21st century, in his early career.

In order to determine the main clients of the artist we should analyze the pie-chart bellow of the structure of transactions made by countries. It can be seen clearly that the most interest in Cattelan is showed by USA, where the artist has lived and worked for a long time, UK and native country – Italy. This chart shows that Maurizio Cattelan is a cross border artist, which means that he has more markets to sell his works, hence, it increases his chances to sell the work.

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Another important indicator to look at in this particular case is the proportion of sculptures, photographs and other media category. As we can see from the chart bellow, sculpture is the main media used by the artist. Hence, we can expect the prices for the sculpture to be higher, because the hand of the master is seen more explicitly rather than, for example, in furniture. This pattern can help us in analyzing the performance of the chessboard “Good versus Evil” which was categorized into Ceramic media category.

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This section is devoted to the lot itself. The subject matter is never out of fashion, which is unresolvable battle of good and evil. The fact that the chessboard has two “teams” – good and bad – and the player can choose a side to fight for might be very appealing and attract more attention and interest from bidders. There are 32 figures hand-painted and crafted by renowned Italian ceramicists Bertozzi and Casoni. Two teams have a mixture of fictional, historical and popular characters from all times. The idea behind this mix is to show good and evil forces in a very broad way and question the concept of reality. Adolf Hitler and Cruella De Vil represent black king and queen, whereas on the “good” side Martin Luther King Jr. and the Virgin Mary appear as main figures. For the white side of the chess there are firefighter, Pinocchio, Mother Teresa, Supermen, Gandhi, Che Gevara and others. For the black side of the chess set we can observe the tree from Adam and Eva’s garden they took the forbidden fruit from, Count Dracula, Rasputin, Donatella Versace and others. There are all unique figures except for Sigmund Freud, whose figure appears on the both sides of the game. The variety of characters brings together different potential byers and attracts different social groups. There are also figures of diverse level of recognition, which implies thin note of irony and humor that can be recognized by educated and intelligent people, which makes byers feel special and smart.

There is a set of seven pieces of this chessboard. This one is the 7th edition. There are only two sets that can be followed with resources available (2nd and 7th), further research will be needed to find other editions, however, it might be suggested that they are in hands of private collectors. In order to understand the estimate, that was given to this lot by experts, previous sales of the chessboards should be analyzed. Sotheby’s New York has estimated the second edition at $3500000-45000 (230000-290000 GDP) in the beginning of 2000s, unfortunately, there is no sign neither of successful nor failing. At 2009, in the very beginning of the economic crisis Christie’s New York reduced the estimate to $250000-35000 (170000-220000 GDP) and lot was sold over the high estimate at $4585000 premium (2768000 GDP). Even during the economic instability and overall decline of the market the lot was sold at unexpected rate, which should attract attention and increase interest among the series of chessboards, hence, increase its market value and price.

Another edition that can be followed is the 7th, which is the lot of my choice. The chessboard is dated by year 2003 and before it was sold at the auction for the first time, chessboard had been exhibited in RS&A LTD in London and Perry Rubenstein Gallery, New York, private collection. In 2007 7th edition appears at evening sale in Christie’s London in “Post War and Contemporary art”, estimated at the $240000-320000 (150000-200000 GDP) and sold over the estimate $423000 (264000 GDP). The market was at its hot spot; hence there might be a lot of bidders who push the hummer price up. Considering constant underestimation and recovered market after the recession, the estimates might have been more aggressive at recent Sotheby’s sale in 2013. However, estimates were the same as in previous sale $240000-320000 (150000-200000 GDP). The popularity of the artist has increased recently, which has added market value. Considering all the factors it might be expected to perform better than the last sale at the auction. The fact that the estimated level had remained the same might be explained if there are issues with condition of the work. If the condition is relatively bad with some extreme damage it may bring the price down. However, after reading the condition report of the Sotheby’s electronic catalogue entry it might be concluded that it is not the case, because “This work is in very good condition. Close inspection reveals a small number of minute scratches to the surface of the wooden chess board in a few isolated places.”[7] Minor scratches unlikely to lower the estimated price.

The placement of the work on preview is also important part of marketing plan to sell the work. The chessboard was placed to the right from the main entrance, next to the star lot. It was placed on such an accessible spot to ensure that as many people as possible will see it. This place adds number of people viewing it and hence creates potential buyers.

In regards of the catalogue entry, there were two whole pages devoted to this lot, which indicates its significance and attracts attention. Since it is a day sale, most of the lots have no more than one page and not much written text about the lot. In case with “Good versus Evil” we have high-resolution picture of reasonable size as well as whole page of catalogue note.

It can be seen in the catalogue, that there is an extra payment for intellectual property rights to the artist as well as temporarily import duties. This shows that the work has been imported and the artist is popular across borders and outside EU as well.

Catalogue note is trying to attract bidders by making the work more desirable. This is achieved through different means; one of them is the language that is used in work and artist description. For example use of subjective adjectives and attaching opinions such as “beautifully executed and intricately detailed”, “[Mauricio Cattelan] one of the most eloquent voices in contemporary art”. Another method used in the catalogue note is to intrigue the readers and add more personality to the text by quoting either artist himself or famous people about the artist or his piece of art. In this particular case it is a quote of contemporary artist Diana Kamin, who says that the chessboard is “battlefield to imagine an epic confrontation between the titular forces”.[8]

In order to bring closer the work and the viewer, there is a short description of some characters from the board, written in a funny and ironic manner. Nevertheless, from my point of view, one of the most important ways to “sell” the lot is description of the exhibition of “The Art of Chess” which was devoted to the legendary and fictional or not game between Napoleon Bonaparte and General Henri-Gratien Bertrand. By making the reference to world known people from history this chess set becomes much more desirable than others. Further research may show that the exhibition was hold in RS&A LTD, London to celebrate the art of playing chess, among other famous contemporary artist such as Damien Hirst, Barbara Kruger, Yayoi Kusama, Paul McCarthy and others. This also adds to the cultural value and therefore market value.

Literature list in the catalogue is not very long and consists only from three entries. All of them are publications in the catalogues for the “Art of Chess” exhibition, catalogues are published in London, Moscow and New York. The work is date 2003, hence, the provenance will not be long, however, for a decade it is followed by clear ownership.

Overall performance at the auction was relatively good, but hummer price (140000GDP) was slightly under the estimate, but still above its reserve price. Unfortunately, the number of bidders is unknown, but final price suggests that there were not many and competition was not strong enough, otherwise hummer price would have been higher. Moreover, since it is an edition of 7 chess sets, it might be argued that the work is not unique, hence, lower the price.

There were two works presented at the auction: “Good versus evil” and “Angolo del Ricordi” installation of a glass mailbox with mail in it. The second lot was 10 lots after the chessboard and was bought in. Unsuccessful performance may be due to unappealing subject matter, unsatisfying condition or other factors that need to be researched further.

To conclude with the topic it should be said that I would have expected higher estimate of this lot and much better performance, because of its previous successful sale and high and stable artist’s position in the market. The fact that the chessboard was downgraded from evening sale in 2003 to day sale in 2013, may have affected the performance as well. It might be argued that if the chessboard were presented at evening sale instead of day may have attract more generous bidders and attention from the “higher” end. Also, this work is not typical for Maurizio Cattelan, so that may have lowered the price as well, because people pay for the brand as well as art, hence, they want it to be recognizable. From my point of view this is a good investment, because I would expect the prices on this artists’ work to increase over time. Moreover, it is a very attractive piece to possess, because not only it is art, but also a chess that has history and meaning behind it.

 

Bibliography:

[1] Phaidon Press Limited, published in 2000, ISBAN 0714838667, Untitled, catalogue of Maurizio Cattalan work

[2] Internet source, Absolutad, http://www.absolutad.com/absolut_lists/ads/pictures/?id=1364&_s=ads

[3] Internet source, Cattelans’ Books, available on http://www.postmedia.net/cattelan/publisher.htm

[4] “Toilet Paper”, internet resource http://www.toiletpapermagazine.org

[5] Internet source, ArtSalrsIndex, available at http://artsalesindex.artinfo.com/asi/search/Maurizio_Cattelan/artistProfile.ai?artistID=30148

[6] Internet source ArtPrice available at http://web.artprice.com/artist/149247/maurizio-cattelan/lots/past?idcurrencyzone=2&iso3=GBP&l=en&p=1&sort=price_desc&unite_to=in

[7[ Condition report, available on http://www.sothebys.com/en/auctions/ecatalogue/2013/contemporary-art-day-auction-l13023/lot.320.html

[8] Sotheby’s catalogue sale, day sale of “Contemporary Art sale” , 2013

[9] Artnet and Artprice were used for indices and graphs, as well as estimates and performance of 2nd edition of the chess set.

Value of Public Art

Every city has distinctive identity: its structure, architecture, memorials, historical monuments and public art contribute to uniqueness of cityscape and create specific features. “Public art supplies another layer of sensitivity to the development process, complementing (and challenging) the work of architecture and landscape design”, said the artist David Patten.

The history of public art started in Greece, when Greek sculptures were placed in public spaces. One of the main examples of public art in Ancient Greece was in Athens – Parthenon (c.447-422 BCE) on the Acropolis. Later, the Roman Empire placed statues of the Emperor in several places to emphasise his power. Since then sculptures, monuments, religious statues have been an inseparable part of a nation’s culture. Nowadays, public art becomes not purely aesthetic but also functional. For example, in Barcelona there are seating areas that incorporate Art Deco sculptures and street lighting.

The definition of public art is not universal, different people and organisation offer different descriptions. McCarthy (2006) suggests that public art is “site specific … in the public domain”, however the type of art is not specified. Others (Hamilton et al, 2001) identify public art in five different forms: sculpture, functional objects, architectural features, landform works and temporary forms. Public art can be of different sizes and of different mediums; it can be a major monument such as The Eiffel Tower in Paris or hidden somewhere in the neighbourhood. In this essay, public art is defined as an art object of any size or medium that has been planned and executed for a specific space accessible for the general public.

Public art is a legacy of a nation and is rarely sold. There are some examples when art has been nearly sold, but the public signed a declaration and prevented the sale. For example, Henry Moore Henry Moore's sculpture Draped Seated Woman“Draped seated woman”located in a deprived area of London was announced for sale in 2012 according to The Guardian (2012) for almost £20 million. People stopped the sale by collecting more than 1,500 signatures in just a few days. Since public art is rarely sold it is difficult to talk about its value. When talking about the value of public art two sides should be considered: cultural value and economic value. This essay will analyse how public art ads cultural value to the society and the city, as well as how public art relates to financial value.

The cultural value of public art is the major component of the value overall. Every day that the sculpture, monument or a statue is on display it gains recognition and cultural value. Non-tangible value of public art includes education, a memorial for historical events, cultural heritage, national identity, inspiration and aesthetic beauty.

Public art to a large extent is covering important national events from the past to honour the memory of ancestors or important historical events. Each large city is full of historical monuments and significant figures. These monuments have different functions: honour memories and educate population. They can be seen as inseparable identity of the city. How can these monuments be valued? For example, the bronze monument to Yuri Dolgorukiy in the heart of Moscow, Russia, was built in 1954 to honour the prince and founder of Moscow. 3581071167_9c596fee61_bThe life-size statue portrays him on a horse. Four architects and artists, S. Orlov, A. Antropov, N. Shtamm and V. Andreev, worked on the design of the monument, which was commissioned for the 800th anniversary of the founding of the city. The statue’s initial cost was 5.5 million rubles of state funds – a huge amount at that time. If the statue was sold today what would it be valued at? If inflation is take into account, the value is many times more than the initial cost, but what about cultural value? This monument is a part of every history book and every educated Russian person knows what it looks like and where to find it. The architects became famous after creating this statue. The educational purpose is undoubtedly important. The statue is not only an honour for the founder of the city, but also an example of the art movement at the time of creation. This piece of public art is extremely important landmark for the city and as a part of Russian cultural identity. No financial figure can reflect its historic and cultural value.

The education and inspiration provided by public art are extremely important factors. Public art educates from a historical perspective and/or educates about art. Public art is like an open-air museum; the artwork has a label with key information. People can read who or what it is and who created it and why. By surrounding citizens with art their appreciation for art increases and they become more educated. In the Forbes magazine interview (2009) Darren Walker, vice-president of the Rockefeller Foundation and vice-chairman of the Foundation for Art and Preservation in Embassies, said that an educated and civil society is impossible without public art and it lifts up humanity and challenges individuals to think differently about the world. Public art is open to the public at all times and people can analyse, explore the details not restricted by opening hours in museums or large crowds in closed spaces. They can return to it many times and discover something new and see it differently.

Non-for-profit organisations such as Forecast Public Art in America add educational value to public art. This organisation creates and manages walking tours around public art and explains the aesthetics, idea and story behind it. The idea of the organisation is to bring artists and community together, so local artists volunteer to give the tours. Public art is valuable for art and architect students as they study proportions, composition, structure and other aspects. Urban planning students can also benefit from public art and study how the artworks are positioned in relation to buildings and streets.

Becker (2004) in Americans for the Arts public report “Public Art: the essential component of creating communities” suggests that public art shows the diversity of the city. In different parts of the city there are different styles of artworks and they correspond to diverse nature of neighborhoods. Moreover, public art is dynamic and new artworks represent new demographics of the city and changing tastes.

Each nation has a different history and artistic characteristics. Italy is always identified with the Coliseum and the Statue of David. When people think of the UK they think about Big Ben, London Eye and red telephone boxes. History and identity is built through developing public art, as art reflects culture and society. The existence of public art in a country becomes valuable as a whole, not as individual objects.

The national identity is represented by public art. If the piece of public art is not an abstract object, but a figure, it represents a significant person or event with a lot of emotional attachment. Every country has important statues of national heroes, leaders, key thinkers, writers, artists and folklore characters. The value of public art can be gained either through the importance of the artist who created it or through the subject matter of the art. There are a lot of sculptures that are crafted by relatively unknown artists, but the figure portrayed is a national hero and carries cultural value. In war conflict or revolution the first things that are destroyed by the victors are statues of people of power. For example, in Iraq the local opposition pulled down the statues of Saddam Hussein. For the nation these public statues, form of public art, represent the cultural value that they no longer supported.

Finally, the value of public art is that it generally improves the urban environment and provides aesthetic beauty for citizens. It is nice to walk in parks and streets that are different because of unique monuments and art objects. These add something special to the environment and create an understanding of being in the particular place. People are more relaxed and thoughtful when surrounded by beautiful sculptures and statues. By developing outdoor public space and decorating it with art governments promote walking and sense of wellbeing.

It is challenging to value public art in public spaces in financial terms because its cultural and economic values are interrelated. Usually there is a direct fee involved in the production of the object which can be considered as the monetary value of public art. However, this fee does not fully reflect the monetary value of an artwork. Public art has indirect financial impacts on the artist and the surrounding area which should also be taken into account. For example, artwork displayed in public space adds cultural value to the artist who created it and is likely to increase prices for his/hers artworks. Public art also has Bilbao Effect: increases foot traffic and, therefore, boosts the local economy. Finally, the real estate market is also influenced by public art, as nearby properties increase in value. Each of these points are analysed in details bellow.

When talking about the value of public art, the first thing that comes to mind – expenses that are directly associated with commissioning, producing and installing the artwork. These expenses, according to Public Art Resource, can be broken down in the following way:

  1. Artist’s Fees
  2. Other professional fees
  3. Material, equipment and production costs
  4. Transport and installation costs
  5. Presentation costs
  6. Administration
  7. Insurances
  8. Contingencies
  9. VAT
  10. Documentation

These expenses are a direct investment in public art. They vary depending on the recognition of the artist, material used, size of the work and the legal complexity associated with installation and authorisation of a particular public artwork.

Public art is commissioned by local authorities, for example, the Fourth Plinth on Trafalgar Square. Alternatively, public art is sponsored by not-for-profit organisations such as Project for Public Spaces or Americans for the Art, where the money is raised through private and public donations. According to Ixia’s (2013) public art survey “The public art sector’s overall value increased slightly from £55 million in 2012 to £58 million in 2013”. This indicates increase in number of commissioned artworks or their value reflecting an increased interest in public art in the UK.

For the artist – being commissioned to create an artwork for public a space is a sign of recognition. His/hers artwork on a public display increases knowledge of his/her style and work. A gain in cultural value trough exhibiting in the public space (Pettersen, 2014) transfers into gain in economic value. How does it affect the value of public art if the artist has gained international recognition and tripled his/her prices compared to the time he/she installed the work? The value of public art depends on the reputation and value of the artist. Hence, it gets even more difficult to estimate the value of public art.

Public art attracts visitors and increases foot traffic. Increased foot traffic boosts the local economy: gift shops, hotels, restaurants and cafes open nearby to satisfy new levels of tourists. This can be related to so-called Bilbao Effect. “For urban planners, politicians, museum directors and trustees, it [Bilbao Effect] means the transformation of a city by a new museum or cultural facility into a vibrant and attractive place for residents, visitors and inward investment”, says The Art News Paper. Bilbao Effect usually refers to large cultural facilities such as museums or art fairs rather than a single public statue or element of architecture. Nevertheless, public art facilitates growth in the local economy.

It is difficult to estimate the economic affect of public art in real terms because the correlation between the installation of public art and improved local economy is not exact. There are many other factors that may influence local business, such as general improvement in the area or appearance of new real estate development, which may be the reason why the art is put there in the first place. Lundi (2012) in her study “Public art – purpose and benefits: exploring strategy in the New England city of Pittsfield” pointed out that there is lack of research and empirical evidence of how much of positive effect there is on local economy. Moreover, McCarthy (2006) suggests that the positive effect on local economy from public art is more of a “belief” than empirical conclusion. However, it might be argued that cultural regeneration also involves public art and it is an inseparable part of the urban planning. There are some cases in whi510c5369b3fc4b7d01000074_ad-classics-parc-g-ell-antoni-gaud-_antoni-gaudi-spain-barcelona-parc-guell-05-samuel-ludwigch the art appeared first and then the economy boosted. For example, Park Guell in Barcelona. It is a park created by Antoni Gaudi in the early 20th century that is a massive tourist attraction today. The infrastructure improved since the park was opened to the general public and now it is surrounded with small cafes, hotels, taxi stations, souvenir shops and other small businesses. In this case it is known that the public art appeared first and then local economy improved to facilitate a large number of tourists.

There are three different types of regeneration driven by culture identified by Evans (2005): culture-led regeneration (large scale developments that drive regeneration), cultural regeneration (when culture is integrated in urban policy) and culture and regeneration (when small objects of public art facilitate regeneration). Public art falls not only in the third category, but more and more often in the cultural regeneration as well because public art becomes a part of real estate developments. This brings us to the next aspect of the economic value of public art.

Modern real estate developments are introducing public art as a part of their project. In some countries, like in America, it is required by law to spend between 1% and 5% of total value of the new development on art. The structure is called “Percent for Art”. Introducing art as a part of a real estate project is part of cultural regeneration, where art and urban planning policy meet. There are many stakeholders in public art in new developments such as tenants, builders, artists, local community and real estate developers. Public art in real estate complexes promotes education, improves aesthetical image of a development and creates a colourful image. However, for the real estate sales prices public art is also important because prices depend on location. Properties that are close to sculptures or have a view from the apartment on the art object are generally more expensive than those that have nothing special in their surroundings. This variety in price that depends on public art can be seen as indirect value of art, as the value of real estate is enhanced by a particular piece of public art. This applies not only for real estate developments, but also for all properties. Generally a property with a view is more expensive than without. In this case “extra” value provided by public art depends on how well known the artwork and the artist are: if the property is overlooking a public art landmark such as Big Ben the mark up for a view will be higher than if the same property is facing an unknown sculpture other things being equal.

After describing different aspects of the cultural and the economic value of public art there are two examples that illustrate these values. Every autumn in Britain a paper poppy becomes a part of people’s lives, which they wear to honour veterans of war. In July 2014 it was no longer a flower on someone’s coat or scarf it became one of the most visited public art installations in the history of the UK – “Blood Swept Lands and Seas of Red”. tower_3049643kThe Installation of 888,246 ceramic flowers two-feet tall covered a massive space next to The Tower of London. Each flower represents a British or colonial fatality in World War I. Artist Paul Cummins designed the installation, poppies were placed individually by thousands of volunteers staring from 17th of July until the Remembrance Day – 11th of November. Then most of the poppies were sold for charity and around 10,000 poppies went to the Imperial War Museum in London.

This installation reflects everything that is valuable about public art, combining high cultural and economic value. “Blood Swept Lands and Seas of Red” was all over the news. The Royal Family as well as the Prime Minister came for the opening and planted a poppy. The story and idea behind the installation were explained many times in the media, which was a free educational lesson. Millions of children might have learned something new about their history and relatives that they might have not known otherwise. The installation was so massive, beautiful and significant that people travelled from across the country to see it. It has been estimated (Marketplace, 2014) that around 4 million people from England and Ireland came to London specifically to see the installation. In economic terms it means that this piece of public art boosted the economy: train tickets, hotels, restaurants and gift shops. This installation influenced the economy indirectly, by increasing tourist numbers, but also by raising money from selling poppies – £25 each. Money raised from the sale – £15 to £25 million – covered all costs associated with the artwork and 10% went to different charities such as Help for Heroes and Combat Stress. This is an example of how public art can be beneficial not only culturally, but also financially.

POTD-Fourth-Plinth_3222055kTrafalgar Square Fourth Plinth is another interesting case of displaying public art. Three out of four plinths on the main square in London have statues installed in 19th century; however, the fourth plinth initially designed for a William IV statue, remained empty due to lack of funds to create the statue. Since 2005 the plinth has been occupied by contemporary art sculptures that were selected by the commission that is led by the Mayor of London’s Culture Team. There are many proposals submitted each year and only six are selected for the next stage. The mini-versions are presented to the public and then the committee decides which one of the six is going to be commissioned.

According to the a member of Arts Council in London, Joyce Wilson, this project plays an important role in engaging audiences in debate about arts and culture generally, and art in the public realm in particular.

Alastair Sooke (2013) from “The Telegraph” argues that the process of choosing an artwork for the plinth is not truly democratic and it is not fair that small committee decides what people are going to look at for next year or so.

The plinth on Trafalgar Square becomes an attraction; people are travelling to see the sculpture and are excited about what is coming next. This is a perfect example how public art can be dynamic and reflect the culture of a city.

There are different types of public art: temporarily exhibited like “Blood Swept Lands and Seas of Red” or those created and still standing by the ancient Greeks. It is extremely difficult to value public art because it gains in value every day and involves so many indirect issues. Public art shapes the national identity alongside its culture. Cultural and aesthetical values combine with the economic and financial values to create a notion of how valuable public art is. The thing that is clear is that public art is beneficial for cityscapes, societies and economies. Public art inspires people, decorates cities, and stimulates tourism and regeneration.

Bibliography:

N/a, (2007) “Tenth anniversary of the Bilbao Guggenheim The “Bilbao Effect”: from poor port to must-see city” THE ART NEWSPAPER, No. 184

Beard, S., (2014) London’s poppies prove the value of public art (Available at http://www.marketplace.org/topics/world/whiteboard/london’s-poppies-prove-value-public-art on 02/05/15)

Becker, J., (2004), Americans for the Arts public report “Public Art: the essential component of creating communities, p 14-15

Evans, G. (2005). Measure for measure: Evaluating the evidence of culture’s contribution to regeneration. Urban Studies 42, (5), 959-983

Forecast Public Art, non for profit organization in the USA (available at http://forecastpublicart.org/forecast/education/ on 04/05/15)

Hamilton, J, Forsyth, L., & De Iongh, D. (2001). Public art: A local authority perspective. Journal of Urban Design, 6, (3), 283-296.

Hill, A. (2012) Henry Moore sculpture decision raises fears for public art, The Guardian, (Available at http://www.theguardian.com/culture/2012/nov/07/henry-moore-sculpture-tower-hamlets-sale on 03/05.15)

Ixia Public Art Survey 2013 (available at http://ixia-info.com/ixias-public-art-surveys/ on 03/05/15)

Laneri, R. (2009) Why We Love and Need Public Art, Forbes (Available at http://www.forbes.com/2009/05/05/state-of-the-city-opinions-george-rickey-public-art.html on 03/05/15)

McCarthy, J. (2006). Regeneration of cultural quarters: Public art for place image or place identity? Journal of Urban Design, 11, (2), 243-262.

Pamela J. Landi , 2012, Public art – purpose and benefits: exploring strategy in the new england city of pittsfield, MA , Graduate School of the University of Massachusetts, p 20

Pettersen A., 2014, Risk and uncertainty in the Art World ed. by Anna M. Dempster, Chapter 3 Value, Risk and contemporary Art ecosystem, p. 71-74

Project for Public Spaces organization web site (available at http://www.pps.org/blog/how-art-economically-benefits-cities/ on 30/04/15)

Public Art Resource (Available at http://www.publicart.ie/main/commissioning/managing-the-commission/budgets/ on 02/05/15)

Singh, A., 05 Mar 2015, Trafalgar Square’s Fourth Plinth taken over by horse’s skeleton”, The Telegraph (available at http://www.telegraph.co.uk/news/newstopics/howaboutthat/11451096/Trafalgar-Squares-Fourth-Plinth-taken-over-by-horses-skeleton.html on 30/04/2015)

Sooke, A., 24 Sep 2013, Why can’t the public vote for Fourth Plinth?” The Telegraph (available at http://www.telegraph.co.uk/culture/art/art-news/10332075/Why-cant-the-public-vote-for-Fourth-Plinth.html on 30/04/2015)

How stamps are valued?

The stamp market has its own eco system with key dealers, main collectors, international fairs and press. Each colleague presents a sector of the market as well as the highlights of his national stamp market. This essay is looking at the stamp market from the economic perspective, describing the factors that influence monetary value of a stamp, establishing authenticity, looking at the performance of the market, and finally describing the highlights of the Russian market.

All the market segments are related and some of the research among group members overlaps. The value of the stamp is the cornerstone of the stamp market: if there is no monetary value there is no market. Hence, it is crucial to determine what influences the value and what is so special about stamps. Research indicates that the high-end stamp market is rather small and the majority of the pieces are medium to low-end.

The study suggests that age, rarity and condition of the stamp are the key factors that determine the value of the stamp. Generally the older the stamp the more desirable it will be on the market (Fairchild, 2012). However, even though the stamp is old it does not necessarily mean that it will be expensive – the rarity is as important as the age. Rarity is defined by how many stamps were issued and how many of them have survived. For example, there were 150 million one-cent Benjamin Franklin stamps issued in 1861, hence, these stamps are unlikely to achieve high prices.

Condition is essential for the value. The condition of gum influences its value. The stamp, which was never used and is free from any disturbance is called mint and is the most valuable. The gradation for the condition of the stamp varies from dealer to dealer. Siegel Auction has six categories of gum condition: mint, lightly hinged, hinge mark, part of original gum, small part of original gum and no gum (Siegel Auction Gallery catalogue). Mint, lightly hinged and hinge mark stamps of pre-1980 are sold at a premium. However, there are some exceptions: stamps issued in tropical climates are expected to have some gum disturbance due to humidity, and such condition is not considered a negative factor in pricing.

Sound condition of a stamp is also determined by the face of the stamp – the design should be centred and the colours bright. Perforation should be round, even and clearly cut. Used stamps are generally more valuable still attached to the envelope or post card, rather then removed from it (DuBasso, 2012). This is because if removed the gum will be damaged.

Unlike any other art market – mistakes, misprints and errors add to the value. A faulted design of the stamp is considered to be a pure rarity and hence increases the value. The reason for that is the strict quality control: the faulted stamps were usually destroyed before distribution. Therefore the stamps that survived are rare and expensive. For example, TreScreen Shot 2014-11-09 at 15.01.36skilling Yellow stamp issued in Sweden in 1855 is the most expensive result of a fault in printing. Originally, all these stamps were produced in green, however, one sheet of nine stamps turned out to be yellow. Only one stamp is known to exist, which definitely contributes to its value. Moreover, after long discussions about authenticity of the stamp, two independent experts have declared it to be genuine. Furthermore, its provenance also adds to its value – it was in possession of King Carlos II of Romania. The stamp was sold privately and realised price is unknown, but according to the Scott World Stamp Catalogue (2013) a used Treskilling Yellow stamp is worth 3 million USD.

The good condition of a stamp does not guarantee a good price for it because there has to be a demand for the design and the country that issued the stamp. There are different trends in the stamp markets and some stamps are more desirable than others: for example, stamps from the UK, French and British colonies and from Russia are generally more expensive than Israeli and Scandinavian stamps.

When determining the value of the stamps it is always useful to consult stamp catalogues. The first catalogues were published in the early 1860s in Great Britain and United States. Originally they only printed the dealers’ prices for stamps. However, philately developed as a hobby over time and now there are plenty of printed and online catalogues over the world. Today’s catalogues provide not only price, but also further details such as issue date, colour variations and different values according to condition.

There are four main catalogues that cover stamps internationally: Scott, Yvert et Tellier, Michel, and Stanley Gibbons. These catalogues have different editions and sections divided by countries and updated every year. There are a lot of domestic catalogues that are issued by leading philatelic dealers or institutions. National Post Offices publish catalogues with the new stamps. However, stamps issued for the last 60 years are generally worth only face value because of the large circulation, unless the stamp is a very limited edition (Mackay, 2012).

Editing the catalogue can be challenging because the value for each stamp should be reviewed individually. According to Charles Snee, editor of Scott catalogue (2014), four editors are working on updating the information and consult dealers and collectors on the subject of value. They consider the stamp market for each country and collectively decide if the value increases, decreases or remains unchanged. The catalogues make it easier to identify the fake: each valuable design can be found in the catalogue.

Genuineness determines the value of a stamp. Authenticity is a big issue in the stamp market as in any other art market. There are connoisseurs, usually collectors or dealers with a lifetime of experience, as well as chemical tests, which analyse paper, ink, and gum. There are new chemical tests that are available on the market – infrared spectroscopy – which examine all components of a stamp without damaging it (E. Imperio et al).

Usually, the auction house stamps are sold with certificates of authenticity. For example, the most expensive stamp ever sold is the one-cent Magenta, The British Guiana stamp issued in 1856. 1It was sold by Sotheby’s New York for 9,480,000 USD including buyers premium in June 2014. Interestingly, even though it is the world record price for a stamp, the estimated value was 10 to 20 million USD and the realised price did not reach the low estimate. This stamp is the only one in existence; it was issued as an emergency stamp when the British colony ran out of stamps. It had impeccable provenance which was a significant factor in determining authenticity. All owners can be traced back to twelve-year-old boy who discovered the stamp in 1873. The stamp was sold with two “Genuine” certificates (Sotheby’s catalogue) issued by the Expert Committee of the Royal Philatelic Society in 1935 and 2014. To further ensure authenticity, experts from the Smithsonian National Postal Museum also examined the stamp before the sale. Generally, the more rare and expensive the stamp is the more important is its authenticity.

Such high prices for a stamp as for the one-cent Magenta are extremely rare. Market performance over the last decades was analysed by looking at the annual Rarities of the World sale by Siegel Auction. This auction house was chosen as one of the biggest auction house specializing in stamps and the data for each sale is available online. The auction house holds many medium value auctions, but Rarities of the World sale is the most important event of the year. The value for the first sale in 1964 is also included to give an idea of where it all began. The data was collected manually and all lots were added individually.

Total Sales graph shows the overall dynamic of the stamp market. The sales fluctuate and there is no clear trend. The revenues were declining before the 2008 Economic Crisis, but the market is gradually recovering since 2011. Rarities of the World sales sometimes include manuscripts, envelopes, and postcards. In 2012 the total sale reached almost 6 million USD, however, this was due to the sale of Emancipation Proclamation signed by Abraham Lincoln for 1,850,000 USD. This sale can be considered as an outlier because it was not a stamp and the price was much greater than for the other lots. To make the results more reliable there is also shown an outcome without this outlier.

133

Source: Siegel Auction, catalogues; Created: 11/2014

The Average graph shows that the average realised price per sale is rising over time even when the outlier is not taken into account. The average was calculated by dividing the total sales by the number of lots per sale and included the bought in lots. In order to determine why the average is increasing the total number of lots statistics has been created.

313

Source: Siegel Auction, catalogues; Created: 11/2014

It can be seen in the graph below that the number of lots per sale is decreasing over time. It can be concluded that there are fewer rare stamps in the market, but they are getting more and more expensive as the average price is rising.

Screen Shot 2014-11-17 at 13.44.05

Source: Siegel Auction, catalogues; Created: 11/2014

The research about market performance could be improved by collecting data from other sales; however, the data is not available. Moreover, the private market is unknown so the market analysis is not representative.

The second part of the study is devoted to the Russian Stamp Market. Unexpectedly the Russian market for stamps is rather developed and Russian stamps are recognised internationally. Even though the market experienced a slowdown after the fall of The Soviet Union, philately is slowly recovering its popularity. Collectors are generally aging population and collections are mainly medium to low in value. It is considered a hobby of childhood, rather than serious investment. Among people who are collectors, 18% collect stamps according to Sterlegrad (2011), which makes stamps the third most popular collectable in Russia after coins and small statues.

During the USSR period philately was extremely popular and everyone collected stamps. However, the reputation of the country was damaged because the government was issuing so called cancel-to-order stamps (Moneu, 2014). The post administration was printing more stamps than needed for the postal services and was selling the excess in bulk to collectors cheaply. This almost destroyed the market of used stamps in Soviet Russia.

According to the newspaper “Izvestia” (2013), Russians were spending 40 million USD for different collectables online in 2007, compared to 2 million in 2007. This is not only because collecting is more popular, but also because of increasing number of Internet users and the development of Internet platforms. The majority of stamp dealers are online platforms such as Molotok and Marka – they sell both low and high value stamps. There are some dealers in large cities, but they usually specialise in different types of collectables. There are two auction houses that are devoted to stamps or have stamp departments: Gelos and Pugachevs Auction House. However, they are not popular as collectors still prefer buying stamps online or in dealers’ shops. Bookshops also sell stamps in the “Antiques and Collectables” section and provide certificates with each stamp and are highly trusted by collectors.

The stamp market is transparent because of the existence of the catalogues; however, all private sales are still unknown to the general public. The data found on the Internet was arranged poorly and sometimes out of date, especially for the Russian market. This essay provided an opportunity for students to analyse the information that has been found and include material that was not in the presentation. In conclusion, it should be said that researching and analysing the stamp market turned out to be challenging and informative.

Bibliography:

DuBasso M., 2012, Stamp Collecting: The Definitive-Everything you ever wanted to know: Do I have a one million dollar stamp in my collection?, published by CreateSpace Independent Publishing Platform, pp 70-90

Fairchild, S. 2012, American Philatelic Society’s Stamp Pricing, APS Chapter 601

Imperio E., Giancane G., Valli L., Spectral Database for Postage Stamps by Means of FT-IR Spectroscopy. Analytical Chemistry, 2013; 85 (15): 7085 DOI

Lyalyalina, A., 2013, Izvestia, Russians began spending 40 million USD per year on antiquaries online, (available on http://izvestia.ru/news/558615 at 09/12/14)

Mackay J., 2012, The Complete Guide to Stamps & Stamp Collecting: The Ultimate Illustrated Reference to Over 3000 of the World’s Best Stamps, and a Professional Guide, Southwater, pp177-180

Moneu News Portal, 2014, (available at   http://www.moneu.narod.ru/marki_4.html on 10/12/14)

Robert A. Siegel Auction catalogue, available at http://www.siegelauctions.com/pdf.php on 05/12/14

Scott Standard Postage Stamp Catalogue Volume 6 Countries of the World San-Z (Scott Standard Postage Stamp Catalogue: Vol.6: Countries Solomon Islands-Z), 2013

Snee C., 2014, When did the Scott catalogues originate, and how are they edited and updated each year? (Available on http://uspsstamps.com/stories/editing-scott-stamp-catalogues on 09/12/14)

Sotheby’s Sale Catalogue entry, June 2014, Lot 1, The British Guiana one-cent black on magenta (available on http://www.sothebys.com/en/auctions/2014/magenta-n09154.html at 01/12/14)

Sterlegrad Newspaper, The most popular collections of Russians, 2011 (available at http://sterlegrad.ru/society/17244-samye-populyarnye-kollekcii-rossiyan.html on 07/12/14)

What are the key challenges that museums face?

The art world is constantly changing and so are art museums. The nature and purpose of museums have been changing from purely cultural involvement towards a social experience. Different types of museums face different challenges when trying to adapt. Contemporary art museums have to accommodate large-scale multimedia pieces, which require new spaces, whereas traditional art museums face problems with maintenance of an old building. Regional museums close because of low visitors number; on the other hands big city museums are trying to manage large number of tourists. This essay will discuss the challenges that museums face in economic, social, technical and ethical fields and analyse possible solutions.

The main challenge that the majority of museums have is a funds deficit. It has been announced that in 2015/2016 museums in the UK will experience a further reduction of 5% of government funding (BBC news, 2012) on top of 10-25% reduction in previous years. In the USA museums experienced 20-40% cuts due to the 2008/2009 economic crisis (Black, 2012). Museum Association “Cuts survey” (2013) indicates, that from 2011 to 2013 the majority of museums experienced more than 10% reduction in overall income. Decrease in income may have adverse consequences such as poorer maintenance of the building, redundancies, failure to fund new projects and update collections. Lack of resources may also lead to dusty displays at museums with art objects sitting on the shelves in an old-fashioned manner. Lack of dynamic change in the museums eventually results in decreasing number of visitors, reduction in opening hours and possible closure. In 2012 according to BBC News 22% of museums have closed during the year.

There are two ways to adjust to budget restraints: to cut costs or to increase profits. Cutting costs does not necessarily mean reducing staff or opening hours: museums can benefit from shared storage and shared transportation costs. Museums from “Cultural districts” can have joint storage and, hence, split transportation costs. Another possible way to attract more visitors and split costs is through creating alliances: multiparty membership can cut advertisement costs, printing costs etc. Museums can increase their profits in many ways: “gift shops”, libraries, online shop, publishing, commercial filming, licencing, brand and product development. The strategy of increasing profitability depends on brand name, available funds and creativity. Many museums still have free admission entrance to their main collections, but charge for exhibitions. The debate about if the museums should be free of charge for educational purposes and how admission charges endorse inequalities, because only those who can afford to pay can go to the special exhibitions. In theory, the best way from a social perspective is to make entrance fees to temporary exhibitions optional: however, this might be possible only when museums generate enough profit to compensate the absence of income from these exhibitions.

Another financial problem is that museums are very dependant on donations and sponsorship. Donations are not predictable and may vary from year to year. Whereas sponsorship is more reliable, but it might raise some ethical issues: how appropriate the business of the company is – is it acceptable to sponsor art with the profits of tobacco companies. Moreover sponsorship may involve bias and excessive control of the exhibition (Kirby, 1988). For example, BP’s long-lasting sponsorship of the British Museum (according to its website), provoked various protests and performances (eg Viking exhibition). John Sauven (2010) in “The Guardian” on the topic of BP sponsoring Tate Britain raised an ethical question of how a respectable museum can associate itself with the biggest source of pollution in the world. Many people suggest that museums should refuse such sponsorship, Jonathan Jones (2010) art critic and journalist presents a different opinion. He argues that usually the public is not even aware of which company contributes to exhibitions and “If they [museums] can get money from Satan himself, they should take it” to stay free and open for the public.

The nature of museums has been changing over the last decades: from being purely educational and cultural to becoming more of a “social hub” (Black, 2012) involving all sorts of activities. Gift shops, libraries, restaurants and cafés, lectures and debates are very common in modern museums. The question is if these changes are driven by severe competition with media, the entertainment industry and technological progress. It was argued more than 2 decades ago (ed. Lumley, 1988), that television gives people better access to cultural places and museums are becoming redundant. Recent technological development might have worsened the situation, because Internet and TV offer high quality documentaries and museums’ virtual tours are accessible at home. However, media and museums have found a way to co-exist in modern environment. More and more museums have audio-guides, mobile apps, Wi-Fi and virtual tours. Multiple surveys confirm that people are still very interested in actual face-to-face experiences with art, as well as the opportunity to socialise and be physically involved.

It might be argued that museums can benefit from further cooperation with the TV and the entertainment industry. A costume exhibition from the TV series Downton Abbey attracted almost 20,000 visitors in Nuneaton Museum according to “The Country Telegraph”. This type of project can be very beneficial, especially for regional museums: they can increase profit by attracting more visitors as well as increase brand awareness through associating themselves with popular cultural media.

Apart from financial and social issues, museums can suffer from a technical problem – lack of display space. Only 5-10% of collection is shown in the museums, the rest stays in storage and some pieces might not be on display for years. This raises an issue of “unusable” heritage that stays outside publics’ knowledge. Lack of funds makes it difficult to change displays, because of the high costs of transportation, insurance, hiring a curator and setting up the exhibition.

However, emerging markets and globalisation offer some solutions, such as franchising. Major museums are expanding nationally (Tate Liverpool) and internationally (Louvre Abu Dhabi), creating an opportunity for more parts of the collection to be presented to the public.

Another possible solution is to sell part of the collection, which gives stored art a fresh audience. It will also partially solve financial problems in museums: however it undermines public trust (Kirby, 1998) and provokes issues such as selecting the pieces for sale, deciding on which subjects are less important than others and predicting future tastes. On the one hand, there are parts of the collections that were donated to museums and might be unwanted; on the other hand if the piece is sold and in twenty years there is increasing demand for such art, the museum is unable to satisfy publics’ interest because of the decision made years ago. Even though the Museum Association has strict guidelines of selling collections it is still subject to debate. For example, Northampton Museum and Art gallery sold a 4000 years old sculpture,which was covenanted never to sell. This sale raised a large amount of money (Apollo, 2014), but undermined Art Council accreditation and provoked differing public opinions.

Unlike old museums, modern museums have already adapted to a changing nature of art and were built considering the scope and scale of art works. Contemporary museums may have a semi-permanent collection or not have a collection at all. For example, in China museums like the Rockbund Art Museum in Shanghai or the Times Museum in Guangzhou provide large spaces for exhibiting collections of international museums (Jouanno, 2013). Such international cooperation can benefit both emerging and established museums.

The survey carried out by “Britainthinks” for the Museum Association (2013) revealed that the three main purposes of museums are caring and preserving heritage, educating the public, especially children, and improving the economy by attracting tourists. In order to “care and preserve heritage” art should be looked after in certain ways – maintaining temperature, level of humidity etc. As the number of visitors increases, the risk of damaging the art works increases as well; hence, to fulfil the main purpose of preserving heritage, museums will have to limit the number of people visiting museums in the future.

Increasing number of visitors raises a lot of different maintenance issues, because buildings wear out, walls get soiled, and floors deteriorate. If the flooring is original from the XVIII-XIX centuries it becomes a part of history and heritage, which gets damaged over time. In 1987 the Louvre separated the stream of visitors by opening additional entrances, however, this might not be a viable option for other museums. Extended hours may be a solution to disperse visitors, but it significantly increases running costs (eg security, electricity, extra staff).

Museums in the XXI century are in transition; they face different financial, social and ethical challenges across the world. Museums have to become more self-sufficient and operate more like a business. In order to do that they have to define objectives such as increasing customer base, increasing brand awareness etc. and creating a business case around it. Advertisement, loyalty schemes and membership cards will help to increase interest in permanent collections rather than one-off exhibition. Some problems may be regarded as “positive challenges”, as they provoke change and stimulate the progress of museums. Solving those problems means that the public will receive independent, modern, educating institutions with updated technology, accessible to everyone and appealing to different social groups.

Bibliography:

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Black, G (2012). “Transforming museums in the twenty-first century”. New York: Routledge. p4-5, 39-45 .

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Colvin, S. (n/a). “Sale of Collection”. Available: http://www.museumsassociation.org/collections/sale-of-collections. Last accessed 10.10.2014

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