Hirst Announces the End of an Era

Are there too many Damien Hirst paintings? Some people are worried that there are, or at least that Hirst was putting the market in his own works in peril by making so many. Those people are relieved that he’s ceasing production of most of his trademark series, a decision announced, idiosyncratically and en passant, in a video on the Sotheby’s website. Bloomberg got a formal confirmation from Hirst’s company, Science Inc:

"Damien does not want to comment further on what he says in the interview, but we can confirm that 2008 will be the last year that Damien produces butterfly paintings, spin paintings or medicine cabinets."

This is big news, and welcome news too, to some collectors:

"This is a reassuring message from Damien," said London dealer Ivor Braka, who confirmed he was the buyer of a $3.3 million Hirst butterfly canvas and a $2.6 million spot painting at Sotheby’s "Red" charity auction in New York in February…

"Some people were beginning to talk about when this level of production was going to stop," said Braka in a phone interview. "We now know these works are finite."

In the short term, this announcement can’t help but boost the prices which the paintings will sell for at the Sotheby’s auction next month. In the longer term, however, there are risks associated with it. Hirst’s success is largely predicated on a steady drumbeat of selling from his dealers around the world. If Hirst stops supplying them with art, they’re going to stop selling it, and the circus could move on.

A lot depends, of course, on what Hirst does in 2009 and onwards. Will he keep his large staff and simply set them to work on brand-new series? Or will he scale down? Given that the most successful artists from Warhol onwards have tended to be the ones with lots of assistants and massive output, I’m sure that Hirst’s business manager is proposing the former course of action. But Hirst is now so wealthy he can do what he likes: he hardly needs the money any more.

In any case, the absence of a primary market in the established series is going to put a much greater emphasis on the secondary market, and I wonder whether some enterprising soul (maybe even Hirst himself) might not try to set up a transparent Hirst exchange which would obviate having to sell to dealers or consign to auction houses. Artists have always tried to have as much control as they can over their primary market; maybe Hirst could be the first to control the secondary market as well. (It would make sense if he did: after all, Hirsts are easily faked, and any painting sold through him would be guaranteed authentic.)

I’m reminded of the demise of Thomas Kinkade, another hugely successful artist who sold in bulk. He was brought down by the growth of a secondary market out of his control. Here’s something I wrote about Kinkade back in 2006; I’m sure that Hirst doesn’t want the market in his paintings to follow a similar trajectory, and that’s one of the reasons that he’s ceasing production of his current series.

There were a lot of Kinkades to go around, and many of the buyers were people who bought on the assumption that their paintings would increase in value and they could make money on their investment. Up until the arrival of the internet, that worked for Kinkade, whose company set the prices for all his paintings and would raise them steadily. After the arrival of the internet, a whole industry arose buying and selling Kinkades at market-set, rather than Kinkade-set, prices. And that was the end of the success days for the company: without monopoly pricing power, Kinkade was nothing.

The stores failed, ultimately, not because Kinkade treated them badly, and not because other stores were undercutting them. The stores failed because Kinkades are a commodity, and anybody wanting to buy one could get a second-hand Kinkade online at a much lower price than that charged at retail. Buyers no longer believed that their paintings would increase in value, so they bought fewer than they used to. And when they did buy, they were likely to buy already-existing Kinkades rather than new ones.

As a general rule, no retailer has ever consistently been able to make money by selling the proposition that his goods are going to increase in value after they’re bought. Kinkade managed it for a few years, but then, inevitably, the bubble burst. And when bubbles burst, people get hurt. It’s not the fault of Thomas Kinkade, it’s simple market dynamics.

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