Edward Dolman on Why a Changing Art Market Could Give Phillips the Edge in the Auction Wars
The CEO of the auction house spoke to artnet News's Andrew Goldstein about his read of the art-market battlefield.
As the CEO of the Phillips auction house, Edward Dolman has one of the confounding challenges in the art business baked into his very job description: How to make the perennially third-string auctioneer a viable contender against the entrenched international Goliaths of Christie’s and Sotheby’s? Fortunately, he also has one of the most impressive resumés in the business as well—and a great deal of insight into the competition, gleaned from years of working for the enemy.
Having famously started his career working as hired muscle in the storeroom of Christie’s London, Dolman spent 27 years working his way up the ladder at the world’s top auction house, eventually reaching the post of CEO and finally becoming chairman in 2010. Then, in 2011, at the tail end of the global financial crisis, he surprised everyone by leaving Christie’s to go work for the Qatar Museums Authority, led by Sheikha Al-Mayassa bint Hamad bin Khalifa Al-Thani, the young, forward-thinking chair of the QMA and the daughter of Qatar’s then-ruling emir. After three years of guiding that Gulf state through one of the most ambitious cultural buildups in modern times, Dolman returned to New York, this time lured by the chance to make an outside run at the auction-market hegemony he once led, this time as the head of Phillips.
To better understand just how Dolman hopes to overthrow what he calls “the ancient duopoly,” artnet News’s editor-in-chief Andrew Goldstein sat down with the veteran auction hand in his comfortable corner office on 57th and Park Avenue to discuss his strategy, and how he came to hone it.
This is the first installment of a two-part interview, with part two focusing on the specifics of Dolman’s plan to disrupt the competition, and the health of the market today.
Before we get to Phillips, let’s go back in time a bit, to that dramatic, unexpected moment in 2011 when you left your decades-long career at Christie’s to join the Qatar Museums Authority. What state was Christie’s in at that time, and what convinced you to make the move?
I always knew that I was never going to finish my career at Christie’s. I put my heart and soul into doing what I could there, and I loved it. But I became CEO at 39—so young, you know—and I never thought, “I’m going to be CEO for another 30 years.” I did not want to be a one-trick pony.
We dealt with various downturns in the market. My first job was to protect the company through the antitrust inquiry that blew up in 2000, and so by the time the financial crisis came along in the late 2000s, I felt very strong in my position as CEO. I was determined to use that opportunity to slightly reshape the company. So I worked hard in the wake of the financial crisis to cut things that I didn’t think were necessary, and to try to make Christie’s as efficient and profitable as possible.
It worked. In 2010, we found ourselves in a really very strong, profitable position. I had been CEO for almost 11 years and felt I had done my bit, and then I was initially delighted to become chair of the company in 2010. But soon I realized it wasn’t working as I had hoped, because my successor as CEO [Steven Murphy, formerly chief executive of the Rodale publishing company] had different ideas about what he wanted to do with Christie’s, and I wasn’t necessarily in support of those ideas.
So it was the right time to accept the incredible opportunity that Qatar gave me. I had gotten to know Qatar a little bit through their purchasing in the art market, and what they offered was very exciting. It wasn’t the commercial art world, it was something more in the museum education space, and it was very exciting to be a part of this new initiative to create a really robust cultural sector for an entire country. I was there, talking to the planners about where the subway stations were going to go to make sure that they linked into the future museums that we were building—it was very exciting stuff.
Then the environment changed a little bit there, and it was obvious after three years that my family wasn’t going to come and join me, so it was time to look for something else. And the Phillips job had always been fascinating to me as an opportunity.
Your arrival coincided with an incredible wellspring of Qatari activity in the art market. The QMA’s purchase of Cézanne’s The Card Players for more than $250 million was reported in 2011, and then the Art Newspaper stunned readers with a report saying that Qatar had actually been the world’s biggest buyer of Modern and contemporary art over the preceding six years, with other known purchases like the $72.8 million Rockefeller Rothko being just the tip of the iceberg. The force behind this wave of acquisitive activity was Sheikha Al-Mayassa, who recruited you. What was her grand plan, and how did you fit into it?
Sheikha Al Mayassa had become a very powerful force in the art world generally, not just in terms of collecting but as a voice for the development of museums and the importance of arts education. She was bearing the torch for a progressive, liberal arts-orientated agenda for her country. In fact, there was an extremely well thought-out state plan with a 2030 vision for how Qatar wanted to develop from a carbon-based economy to a knowledge-based economy, using the money generated by this extraordinary wealth from oil and gas.
Part of that plan was the development of an art sector, and I was just a piece of that journey for them. They were quite active in terms of commissioning artists and architects to make museums and public arts programs, with the installation of works by Richard Serra, Damien Hirst, and others. I was lucky enough to be a part of it for a while.
What was your involvement, exactly? It must have been useful to have a former CEO of Christie’s on hand to help bring in top-dollar art-historical masterpieces.
Well, it wasn’t as if my arrival suddenly stimulated all these sort of high-priced purchases. My focus was much more the development of the museums, working with the museum directors on their collections, and working with the architects. That was much more exciting to me than anything that was going on in the art market—although obviously Qatar’s activities in the art market were well reported, and quite significant at that time.
Can you talk about any purchases that you helped arrange in particular?
You remained there for three years, and toward the end of that time, Qatar’s participation in the art world began to subside. It no longer moved as aggressively toward becoming an art powerhouse. What happened?
I think the whole political environment has changed in that part of the world. From my perspective, a lot of the tremendous optimism around the Arab Spring—like the development of Al Jazeera, and the confident play to join the modern world stage when it came to art and journalism—went away because, unfortunately, the political situation there is becoming increasingly complicated and difficult. I know Qatar’s goals are still exactly the same as they always have been. I just think that the whole situation has become a hell of a lot more complicated, just in the few years since I left.
In 2013, the emirship was passed down to Sheikha Al Mayassa’s brother, Sheikh Tamim, a now-37-year-old ruler with more conservative leanings and ties to the Muslim Brotherhood. Soon thereafter, Leonid Friedland and Leonid Strunin, the owners of the Mercury Group, Russia’s largest luxury retail consortium, approached you about taking over Phillips, which they had acquired in 2008. How did that transpire?
When I was at Christie’s, I had always been very interested in Phillips as a potential competitor. I grew up in the London art market, where Phillips was a very substantial number-three player. Then, however, they had a complete transformation when Bernard Arnault bought Phillips and then bought the Galerie de Pury & Luxembourg at the same time and merged them, hoping to create a really strong competitor to Christie’s in the high-end art market in New York.
Phillips had been in New York before, but it never aimed for that top-end with such focus. So Arnault poured a huge amount of money into Phillips at that time, and of course I paid close attention, because they were directly competing against us. For a brief period of a few months, Christie’s and Sotheby’s were losing lots of high-end material to Phillips because of the generous guarantees and financial offers they were providing. And then, you know, I watched Arnault’s attempt to drive a horse and cart through the duopoly fail, basically.
Afterwards, Simon de Pury sort of carried on. Phillips was much less powerful then, but still quite an interesting company. So I was very interested in 2008 to see these Russian luxury goods magnates buy Phillips. I watched them develop it, invest in it, and move the Phillips salesroom from downtown Chelsea to 57th and Park. When I eventually bumped into them again at the Venice Biennale in 2013, I was very interested to meet them face-to-face.
It was just a chance meeting, but they were obviously very serious about their ambitions for Phillips. It was a time of transition in Qatar with the emir changing, and I felt I had contributed as much as I could, so I became intrigued. When they showed me the Berkeley Square building in London that they had just invested in, it was mind-boggling. At that point, I thought, I would love to give it go and see if I can turn all the thoughts I had over the years about Phillips into reality.
After Arnault tried and failed to drive his cart through the duopoly, as you put it, Simon de Pury tried to make Phillips into the anti-Christie’s, in a sense, creating a nightclub-style atmosphere with DJs and parties and sexy, nearly pornographic catalog covers and lots of razzmatazz. It seemed to be an attempt to lure in unsophisticated new buyers, to make contemporary art un-intimidating and educate a fresh collector base over time. What was your reading of his strategy?
In the time between when Bernard Arnault bought Phillips and tried to break into the duopoly to the moment where the Leonids bought Phillips, there was a complete and utter revolution in taste and values in the art market. When Bernard Arnault bought Phillips, he had to break into a tiny market of very well established and super-rich elites on the Upper East Side, or in Mayfair or Paris, who collected 18th-century French furniture or Old Master pictures or Impressionist or Modern art. It was very tough to break into this well-established connoisseurs’ market, because it wasn’t very big. The turnover at the companies was tiny then.
What Simon recognized was that an extraordinary change in taste was happening, driven completely by a new client base that was coming in—wealthy internet entrepreneurs, newly enriched Russians, and newly enriched mainland Chinese who had no connection with or desire to be a part of this previous club of connoisseurs. These were new, young people with loads of money who wanted to be a part of this internet age and wanted contemporary art. So Simon wanted to be the antidote to these crusty, slightly backward-looking organizations, and was trying to style Phillips as the auction house for this new group.
But by the time Simon did that, it was too late. When 2008 comes along and Mercury acquires Phillips, this transition to postwar and contemporary has already happened, so many people wondered, why was Simon throwing all these crazy parties to attract people to contemporary art? Contemporary art had become mainstream.
From the moment the Leonids came in, it was clear that they had slightly different agenda for Phillips—which was to invest in quality, like the luxe new headquarters on Berkley Square and Park Avenue, in pursuit of a different paradigm. How did they present their strategy to you in a way that was different from the Simon de Pury approach?
The Mercury Group’s owners are young, you know? And by the time they bought Phillips, contemporary art was no longer this slightly weird, quirky place where young kids go to have a bit of fun—it was suddenly where all the mainstream collectors were. Eli Broad, François Pinault, Bernard Arnault himself, and all the other guys who had been there a long time were now leading this contemporary charge. So instead of wanting a funky place in Chelsea, you needed to be mainstream too.
Just look at Mayfair in London, the perfect example of an area that used to be dominated by Old Master picture dealers and 18th-century furniture. Now, Mayfair is contemporary art—and everybody else is gone.
So the Mercury Group bought a company that they thought was well positioned to focus on this new mainstream. They had a contemporary vision and were very connected to the fashion world, so they understood taste. It didn’t seem odd to them at all not to have 18th-century French furniture or Orientalist paintings from the 19th century—that just wasn’t part of the world they saw. It was very enabling.
If, as has happened, all of the major auction houses seize on contemporary art as this new mainstream, doesn’t that pose a significant challenge to Phillips? If your point of differentiation disappears, how is it possible to compete against these behemoths of Christie’s and Sotheby’s? What is your unique value proposition?
Everything Phillips does is about positioning itself in the 20th- and 21st-century art markets. The Berkeley Square salesroom is a perfect example of that, because the spaces are tailored for contemporary art, pure and simple. When you’re running a large auction house, there’s always this question of where you position the brand, because you’ve got to appeal to an Old Master collector as well as a collector of Lucian Freud or even Mark Grotjahn. So there was a battle of brands that happened all the time within these organizations. We, frankly, just have to offer expertise, better viewing facilities, better catalogs, better marketing—you know, we have to compete and be better at what we do than anybody else. And when it comes to contemporary art, our focus really helps.
So, whereas Phillips was once a smaller animal among the big predators, darting after the morsels dropped on the forest floor, now, at least in this realm of contemporary art, it has grown into a rival on equal footing?
Yeah. It’s a credible player in exactly this area, and we now compete with Christie’s and Sotheby’s on a regular basis to sell works for consigners. I think the establishment of Phillips as a credible auctioneer of high-end contemporary art internationally is one of the company’s major accomplishments over the last three years.
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