Christie’s, the renowned international auction house, has proven that the secondary market for luxury items continues to be a highly profitable source of income. The COVID-19 pandemic played a major role in accelerating the shift towards digital platforms, as high net-worth individuals (HNWI) had more time on their hands and limited access to physical stores. As production lines came to a halt and people sought tangible investments, the scarcity of goods also contributed to the rise of online luxury auctions. Christie’s expects this trend to endure even after the pandemic, based on its exceptional performance in 2022 when it generated a total of $8.4 billion, including $988,000 solely from luxury sales. The company is on track to match or surpass these figures in 2023.
In an interview with FashionNetwork.com, three curators from Christie’s luxury departments, specializing in jewelry, watches, and handbags, shed light on the factors driving the company’s record-breaking growth. One important factor is the involvement of a new generation of auction participants who find online auctions less intimidating due to enticing opening bids and the convenience of digital platforms. According to Claiborne Poindexter, a senior specialist in the jewelry department, auctions have transformed from “stuffy rooms” into events accessible to a wider audience.
In the jewelry market, second-hand pieces have gained popularity, particularly as the industry shifts towards lab-grown diamonds that are perceived as ethically superior. Sustainability has become a consideration for many luxury buyers. Christie’s jewelry auctions are a reflection of market trends, witnessing increased demand for 1970s styles. Brands like Graff, Chanel, Van Cleef & Arpels, Cartier, Tiffany & Co., and JAR perform exceptionally well in this category. In 2022, jewelry sales reached over $449,000.
Watches have also experienced a surge in auction activity. Affluent individuals, whose incomes remained unaffected during the pandemic, developed a stronger interest in watches and started buying and selling them through auctions. In 2022, Christie’s watch department achieved record-breaking sales of over $208 million, and H1 2023 sales have already exceeded $400 million. Rebecca Ross, the head of sale watches, explains that watches are seen as commodities that can be easily traded. The value of a watch is influenced by trends and brand names, with Patek Philippe and Rolex consistently performing well. However, newer brands like FP Journe, Patton, Kari Voutilainen, Philippe Dufour, and De Bethune are also gaining recognition.
Designer handbags have emerged as a booming category in the ever-surprising world of luxury auctions. Christie’s has witnessed a significant increase in sales of second-owner market handbags, with Parisian brands leading the way. In H1 2023 alone, Christie’s has sold handbags worth $20 million, with a notable sale of $4.1 million in New York. Rachel Koffsky, the international head of handbags at Christie’s, explains that certain names like Hermes, Chanel, and Dior consistently perform well, while demand for specific styles fluctuates over time. Social media channels have played a crucial role in attracting new bidders to the auction world, familiarizing buyers with the process. Rarity and condition are critical factors in the handbag category, and Christie’s carefully selects the items it offers for auction.
To cater to prospective bidders, Christie’s organizes luxury weeks in June and December, during which galleries are open for customers to view upcoming items for live and online auctions. Private sales with predetermined fixed prices are also available, along with charity-centric auctions like Only Watch in Geneva.
The pandemic undoubtedly expedited the digital revolution in the auction industry, particularly in the United States, where lockdowns and travel restrictions disrupted retail operations. As a result, first-time auction buyers, including millennials, turned to Christie’s, often discovering bidding opportunities through social media platforms. The secondary market has witnessed an influx of property, and the overall interest in auctions remains strong. Interestingly, the reasons for selling luxury items have also shifted, with some clients simply wanting to refresh their collections. Christie’s luxury consultants note that the traditional driving forces behind sales, namely “death, debt, and divorce,” no longer hold true.
Christie’s success in the secondary market for luxury items underscores the enduring appeal and value of these goods. The digital transformation of the auction industry has made it more accessible to a wider audience, fueling its continuous growth. As the world progresses further into the digital age, the earnings potential of the luxury secondary market is likely to remain strong, with Christie’s leading the way in this lucrative industry.
Useful Links:
1. Christie’s Official Website
2. FashionNetwork.com
