PRIMARY MARKET? SECONDARY MARKET? HOW DOES THE ART MARKET WORK?
You may have heard of auction houses and galleries, but you might not know that all art sales fall into one of two categories: the primary art market and the secondary art market. And the distinction is an important one.
The primary art market is where every artwork starts out when it is first made available for sale. Whether that sale happens directly through an artist or (what is more typical) through a gallery that is exhibiting the artist’s work, this moment in an artwork’s life usually sets the precedent for future sales.
After a work is sold for the first time–whether at auction or through a gallery–it enters its secondary market lifecycle where it remains no matter how often it is bought and resold going forward. This is also the stage in a work’s lifecycle where its value has the potential to increase dramatically. If it was created by an artist whose profile has risen significantly from the time it was made, that could lead to a spike in price. And if it’s a piece that’s become emblematic of an artist’s career, such as Jeff Koons’ balloon-like sculptures, that's all the more true. That said, like any marketplace, speculation can drive up prices on the secondary market for no reason other than a temporary spike in demand.
If you’re wondering how Platform fits into this system, Platform is an extension of the primary market since all the works for sale on Platform are being made available directly through galleries that represent artists.