Twelve years after their first online collaboration, Sotheby’s and eBay have formed a second partnership to stream Sotheby’s sales worldwide.
The deal to "unite the global leader in online shopping with the
iconic international art business and auctioneer" will see New York
sales broadcast live on a new section of eBay's website from the
autumn, with the expectation that the partnership will later
include sales from Sotheby's other salerooms and online-only events
at more accessible price points.
Both companies will be keen to avoid any repeat of past
mistakes. Sotheby's began their online experiment in 1999,
partnering first with Amazon and then with eBay in 2002. Both
projects folded after a year with Sotheby's registering losses of
more than $100m. For their part, eBay's attempts to improve their
fleamarket image, beginning with the acquisition of California
saleroom Butterfield & Butterfield - sold on to Bonhams when
the experiment failed - and the launch of eBay Great Collections in
1999, have yet to bear fruit.
Their most recent venture, eBay Live Auctions, which integrated
the content of the US online bidding platform Live Auctioneers with
eBay's marketplace, ceased in 2009.
Announced on July 14, just months after the activist shareholder
Daniel Loeb criticised Sotheby's for what he saw as their
antiquated business practices, the new Sotheby's-eBay partnership
is forged in the belief that earlier failures amounted to 'right
idea, wrong time' - attempted before customer trust in e-commerce
and the advent of the smartphone revolution.
Pool of Customers
A decade since their last collaboration, Sotheby's still see
value in eBay's huge but varied worldwide audience of 145 million.
"Even if we only reach point 1% of eBay users, that's huge for us,"
said Bruno Vinciguerra, Sotheby's chief operating officer, who is
keen to expand beyond a current pool of 100,000 exclusive
In their press release, Sotheby's and eBay provided data to
suggest how two businesses from apparently opposite ends of the
auction spectrum (both risk challenging their brand image with the
deal) will complement one another. Both have enjoyed significant
spikes in mobile traffic (tablets and smartphones now account for
25% of total Sotheby's website traffic), while Sotheby's say sales
achieved via their live bidding technology increased by more than a
third in 2013.
Significantly perhaps, both companies say they will now seek to
grow their market share at the price points where they expect their
collectors to converge in the future - particularly in the segments
well suited to online trading such as jewellery, watches, prints,
wine, photographs and 20th century design.
Each day on eBay, more than 3500 auctions close at prices over
$5000, while in 2013 more than half of Sotheby's lots were sold
within the $5000-100,000 range. It remains to be seen if, for
Sotheby's, this amounts to an intention to compete once again in
the middle market they have largely dropped since the advent of the
'fewer lots, higher values' policy a decade ago.
All Sotheby's New York catalogues (minus the flagship evening
sales) will be accessible via a new 'experience' on the eBay site
tailored for customers who are looking to discover premium art and
EBay describe Sotheby's as the "pre-eminent anchor tenant" on
this new platform, providing both premium merchandise and its brand
name, but there will be "other important partners" - including
clients of Invaluable, the US-based provider of online live
auctions who in May announced a partnership to bring live auctions
of art and antiques back to the eBay platform.
Auctioneers will pay eBay a commission on each sale that takes
place on eBay - although for now at least shoppers would pay
Sotheby's directly for any purchases rather than use an online
payment solution such as PayPal. That could, however, become an
alternative payment method in the future.
Meanwhile, Christie's have announced further investment in their
e-commerce. While Sotheby's plan is to work with eBay without
making another heavy investment in technology, their rivals are
taking a different path to capture more online business, announcing
last week a $50m investment that will allow for more internet-only
auctions and a website redesign. Last year Christie's, who held
their first online-only auction in December 2011, conducted 60
online auctions generating 30% of their new buyers.
The recent TEFAF report found that online sales of art and
antiques in 2013 represented only 5% of the art market (far below
the average for luxury goods), but did expect online art and
antiques sales to increase by about 25% a year for the next few
Sotheby's Online Partnerships - A Brief
• June 1999: Sotheby's partner with Amazon.com
(who invest $35m in the auction house) to sell art and antiques
through a jointly operated auction site, www.Sothebys.Amazon.com.
The intention is to create a separate marketplace from Sotheby's
existing auctions with dealer partners.
• October 1999: six months after eBay acquire
West Coast auction house Butterfield & Butterfield for $260m,
eBay launch Great Collections, a site offering more expensive
merchandise sourced from reputable auction houses and dealers.
• October 2000: Amazon and Sotheby's announce a
'friendly separation' and the dissolution of their jointly operated
auction site, Sothebys.Amazon.com. The venture is plagued by
customer service problems.
• January 2002: Sotheby's and eBay announce a
partnership. Sotheby's hire almost 200 staff to support the project
to hold online auctions at Sothebys.Ebay.com.
• August 2002: eBay announce the sale of
Butterfield & Butterfield to London-based auction house
Bonhams. Great Collections, now called eBay Premier, is shut
• February 2003: Sotheby's announce that they
will no longer hold sales on Sothebys.Ebay.com, revealing a loss of
approximately $100m on Internet operations across three years. The
partnership with eBay is officially dissolved in May.
• January 2009: eBay Live Auctions, which
integrated with eBay's marketplace, is closed. eBay had no way to
authenticate or vet the antiques that were being sold.
• August 2013: Amazon launch a fine art store
with 40,000 works of art from more than 150 galleries and
• July 2014: Sotheby's and eBay announce a
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