Persistence | COVID 19 and the Art Market

It’s been several weeks since I’ve updated Reddot readers about what we are seeing with the art market during the current situation. This is not because there hasn’t been news, but because we’ve been very busy. I wanted to give you a quick update in several areas relevant to the art market and what we’re experiencing at Xanadu.

PPP

Several weeks ago, I wrote about the frustrations involved in applying for the Small Business Administration’s PPP loan. We ended up putting together applications through several different financial institutions (none of them our bank). It turned out that Cross River, the lender recommended by Gusto, our payroll processing company, was able to process our application and get the loan approved by the SBA.

We only found out the loan had been approved after the first round of funding had been exhausted. Fortunately, Cross River had processed the paperwork and received approval prior to the funds running out. We received funding just a little over a week ago.

The loan is forgivable if certain criteria are met, but there is a fair amount of complexity surrounding the forgiveness process. I’ll have updates as we work through that process.

While it certainly wasn’t a simple or smooth process, the funds are definitely a lifeline to us, our employees, and to many other businesses.

Congress has since approved a second round of funding, and I remind you that if you can document income from your art business, you may qualify to receive emergency relief funding through the program. It would definitely be worth talking to your bank to see if you qualify.

Since we applied, a number of financial institutions have announced that they can process the applications. If your bank can’t help, it may be worth exploring other options. I’ve seen announcements from squareup.com, PayPal, and Cross River regarding PPP application processing.

Sales

Xanadu sales, in dollar volume, April 2020 (green), compared to April 2019 (dashed).

While our gallery remained closed through the entire month of April, we were able to continue to make sales thanks to our increased social media and email marketing efforts. Many thanks are due to Xanadu staff for their diligence in putting together emails and social media posts, and for their follow-up with customers.

Our sales for April 2020 were down by about 53% when compared to April 2019. A breathtaking decline, to be sure, but I consider the sales we made during the month to be a huge victory when considering the state of the world. The sales are a testament to the importance of cultivating an online relationship with our clients, to having the ability to promote our art online and through social media, and the infrastructure to process the sales through our website.

Not surprisingly, April was a record month for online sales. We saw purchase across a broad range of price points. I wish that I could report that we generated sales for all of the artists we represent, but unfortunately we weren’t. It was deeply gratifying to send out payments to the artist for whom we were able to generate sales, and we will continue our marketing efforts in the hopes that we can help support all of our artists through this difficult time.

We will continue our email and social media marketing, and our May/June Art Catalogue is out digitally and the physical issue will begin hitting our clients’ mailboxes next week.

Reopening

Arizona Governor Doug Ducey announced last week that retail businesses like ours would be able to reopen in phases beginning this week. Retail businesses of all sizes would be able to open for curbside pickup on Monday, May 4th, and for limited retail engagement beginning Friday, May 8th.

Our business doesn’t lend itself to curbside pickup; we are shipping all of our orders, including those made by local clients. We are eagerly looking forward to being back open this weekend, however, even if there are certain restrictions in place. It remains to be seen how and when our clients will begin venturing out into public, and the health and safety of our clients and staff remains our top priority.

Stay Tuned

Keep an eye out for updates next week as we open back up, and as we prepare to open our Pinetop, AZ gallery for the summer season.

What Are You Experiencing?

Have you applied for the PPP loan? How were your sales during the month of April? Are the galleries that represent you and other retailers in your area beginning to open back up? Share your experiences and thoughts in the comments below.

 

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About the Author: Jason Horejs

Jason Horejs is the Owner of Xanadu Gallery, author of Dad was an Artist | A Survivor's Story and best selling books "Starving" to Successful & How to Sell Art , publisher of reddotblog.com, and founder of ARTsala. Jason has helped thousands of artists prepare themselves to more effectively market their work, build relationships with galleries and collectors, and turn their artistic passion into a viable business. Connect with Jason on Facebook

19 Comments

  1. Jason,
    Thanks for the update regarding the impact Covid-19 is having on your business. It will be particularly interesting to see how people respond once you and others are again physically open for business. I believe the reactions and selections individual consumers make (actually leaving their homes, entering galleries and other retail establishments, and of course whether they actually purchase) is going to be one of the most important leading indicators for how fast and strong the economy will recover. You sharing these facts is and will continue to be helpful to all of us.

  2. Thank you for your encouragement. My online sales have been up in April, about 50% more. Over all sales have been about 75% less. I have given sale incentives and continue to post on Social Media driving ppl to my website. I jus try to stay relevant. I have continued to promote the gallery who represents my work. They gave an outdoor Sculpture walk over the weekend with great success. Many ppl just wanted to get out of the house and have something to do. Many were so happy to be out! Well worth it!

  3. I made one direct sale which I allocated to the gallery that sells my work since I had added it to their inventory two days before. The gallery also sold one painting of mine from their inline store. Sales for me were slightly down, but not by a large percentage.

  4. Thanks for the update. Oregon is still closed and that includes galleries. Several artists in my building have made significant sales. I have made one small sale in the past week. No classes scheduled in the studio, but I will launch a live, Zoom class later this week.

  5. I sell my art mainly in person at sales and shows – and a couple are hoping to open up in June. Like you I worry that no one will risk coming out. But the more I thought about it I realized the ones that do will be there to buy it will just be the tire kickers that stay away – which might not be a bad thing. 10 serious buyers are worth more than 100 people just out for a stroll . I have sold a few pieces through my web site and social media but not really enough to make it a viable business model – For myself in person is always more profitable. I enjoy the selling process and interaction as much as creating the art

  6. Thank you for sharing this information with us. I have applied for the PPP loan through SquareUp and got funding in less than four days. I usually don’t sell my pieces online, because they are large and it’s a bigger investment for my customers. I spent some time in March creating smaller pieces that don’t require a large investment and is easy to sell as an introductory piece to new collectors via social media. After publishing the paintings on Facebook and Instagram I sold mostly 12″x12″, 24″x24″, and 36″x48″ paintings. Also a past customer who is managing a clubhouse on the ocean in Boca Raton reached out to me and commissioned for 26 original paintings after seeing the email blast I sent. The commission was just me getting lucky and tackling past customers. I believe keeping track of your customer base is a really important. You just never know what result you will get from reaching out to them. I’m hoping now that some have purchased smaller pieces and see the work and quality in person, they will pull the trigger on purchasing larger pieces.

  7. It just so happened that I was wrapping up a year long website rebuild and had saved enough funds to take a 12 week course in art marketing which I saw as a logical extension to your ABA. And three weeks in, COVID-19 upended the world so to speak but the course went on and my art life was changed.
    I continue to have no real sales record. I remain hopeful, forward lookihg, and bright. Who knew I would be conversant with zoom, slack, instagram (still a mystery), a powerful tool attached to the website called the “proprietary mailing list” otherwise known as “the newsletter sign-up.” Jason, as you read this, I can feel your knowing smile.

    It is still a great sorrow to think of those who have and will die because of misunderstanding and mis-calculation.
    It is with hope that the altered world we will come to know will be ours to embrace.
    When I was teaching young people and they got into a corner so to speak my favorite line was, “Where’s your spirit of adventure?” Who knew I would be my own student.

  8. My gallery is located in Canada, and I am not expecting to be able to re-open until mid-late June at the earliest. They are (IMHO rightfully so) taking a very cautious approach to opening up the economy here.

    I wish I was only down 53%! Unfortunately even though I had great face to face sales in the gallery, I have never managed to gain any traction online so we are down 100% since mid-March when we had to close. Hard to teach an old dog new tricks.

    Fortunately the Govt of Canada has been excellent in shoring up small businesses, but our monthly nut still has to be taken of open or not.

    I have no idea how I am going to deal with gallery visitors (if they even come) in terms of managing cleaning, etc. I have a lot of flat packaged prints out in the open that customer rifle through, and keeping them virus free is going to be an issue.

    I may have to instigate a one person at a time and supply a mask and gloves policy until and if this settles down. I will be very interested to see how you manage these issues.

    I sincerely wish you the best Jason!

    Kenneth

  9. Illinois is still locked down with no end in sight; shows cancelled or postponed to unknown future dates. I have no idea how long galleries can be shut down and survive…. applied as self-employed artist & rejected. Online sales are up @24% but everything else is zero.

  10. My galleries are all closed, but in March and April, my Santa Fe and Durango, Colorado galleries have sold several paintings, and I’ve sold more than several from my studio, including a number of commissions.

    I’m not sure exactly what combination of concentrated LinkedIn, Facebook, and email/newsletter marketing (or offering good discounts) is working, but God has blessed me with lots of art sales. Maybe it’s because my work is fun and colorful, and that’s what people need. In fact the collector who called today to request a commission piece said he “needed” that painting.

  11. Our co-op galllery got $1000 which helped with the dues we waived, we’ve been on facebook and opened a store page where you can buy. But business is way down. We are opening ,in Colo., this weekend with reduced hours and mask recommendations plus the obvious protocols. I find it frustrating. I did take part in several online auctions but didn’t find them that good for myself, one sold for the asking price and the other the person got it for 1/2 price. A gamble for sure.

  12. Thank you for posting this article, and for the honest and generous responses. From your experiences, I have gained valuable information on how to sell online, which I’m aspiring to do. Thank You. For the past two years, I have not been active nor productive with my art business due to personal issues. So, I didn’t make any sales, thus, no loss or gain in this pandemic. The changes in living conditions due to COVID-19, helped me rearranged my priorities to put my energy and attention in things that mattered most to me. One of those priorities is to build my online art business to monetize my website.

  13. Hi Jason. Thanks for filling us in on how your Gallery is doing. Glad to hear you are getting some funds. I am up in BC Canada and the Port that owns our space that we rent is waiving our rent for the time being. I have not been called in to work, as I have a bunch of pre-existing conditions that might make it nasty if I got the virus.
    I have been maintaining a Facebook business presence and whereas that hasn’t led to sales yet, people are liking the page and postings. I am finding that folks are enjoying watching a work go from beginning to finished product.

  14. Thank you for these posts Jason. I do hope all those in need of financial assistance receive it in a timely manner. I am in an enviable position wherein I receive pensions and rent income from reliable renters. Since I am independently wealthy…everything is relative!…my routine has not changed much except for the season. I am concentrating on an internet presence and have done more advertising than usual. That has brought in the usual batch of scammers. Otherwise, working in my studio and outside in the yard fills my days. I have appreciated not having a deadline of late.

  15. Hi Jason. I’m so happy not hear you can open back up and the lockdown was short in AZ. Here in CT we are locked down in until at least May 20. Some galleries have cancelled events in June as well which was disappointing for me as I was to participate in a show which may be done virtually which is cool but not as good as people seeing the work in person. With the exception of an opening night, I find that art galleries usually don’t have more than one or two people in them at one time. Certainly safer than the grocery store! I’m confident people will come in to your beautiful gallery! I know I would! Best wishes to you and Xanadu

  16. Hi Jason. I’m so happy to hear you can open back up and the lockdown was short in AZ. Here in CT we are locked down in until at least May 20. Some galleries have cancelled events in June as well which was disappointing for me as I was to participate in a show which may be done virtually which is cool but not as good as people seeing the work in person. With the exception of an opening night, I find that art galleries usually don’t have more than one or two people in them at one time. Certainly safer than the grocery store! I’m confident people will come in to your beautiful gallery! I know I would! Best wishes to you and Xanadu

  17. I’m sorry to hear your sales are down. Good you were able to access funding though, what a relief that must be. I’m sure spending will pick up as people are once again back at work and venturing out. Myself, I’ve been very blessed with my sales. I’m more grateful than ever for my collectors. They have such faith and love for what I do. That plus the extra time on my hands (minus having to homeschool two children while we are locked down) has meant I am really on a roll with my work. I think those of us who have passions we can channel during this time are incredibly lucky. My only concern is that I had plans to travel overseas this year to promote my work further and now that seems unlikely.

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