To proponents of creative destruction, the art business has never felt more like home than right now.
Sellers across the market are struggling to reverse its most sustained swoon since the early 2000s amid a multitrillion-dollar generational transfer of wealth, from Boomers to Millennials, who don’t collect art the way their parents did. Downsizings and closures have plagued commercial galleries this year.
Within this moment of flux, powerhouse auctioneers Christie’s and Sotheby’s are re-examining what a global auction house should be today, to be poised for future success. And as the privately held, multibillion-dollar colossi eachseek to gain a clear edge over the other — and thereby upend the duopoly that has dominated the sector for hundreds of years — their strategies and marketing pitches have become ever-more distinct.
If either house succeeds, the ripple effects will motivate others to reconsider their own strategies in an industry where the line between top galleries and top auctioneers has never been thinner. But even if the duopoly persists, it will reinforce the pivot both houses are making simultaneously: from auctioning art to auctioning a wider selection of luxury goods, from Birkin bags to collectible cars.
For both firms, evolution is urgent. Although Christie’s and Sotheby’s together accounted for nearly half the value of the entire auction sector’s public sales and around two-thirds of its private sales in 2024, according to data from the Art Basel & UBS Art Market Report, their top-line results dropped precipitously the past two years. Between 2022 and 2024, overall sales at Christie’s declined 32 percent while sales at Sotheby’s fell around 25 percent. Public filings by Sotheby’s parent Bidfair Luxembourg also showed the auction house’s annual pre-tax loss more than doubling to $248 million last year. (Similar filings were not available for Christie’s.)
“There is already an understanding by both auction houses that, in the business models as they’ve existed for a long time, the profit margins are unsustainable as the costs go up,” observes Natasha Degen, the chair of art market studies at New York’s Fashion Institute of Technology, citing increased shipping expenses and deeper concessions to consignors as top issues.
The crucial question is whether either house has a real fix.
The View From the Top
The differences in the strategies employed by Christie’s and Sotheby’s start with the differences between their French billionaire owners. Kering founder François Pinault — whose holding company Artémis took Christie’s private in 1998 — has been a premier art patron for decades. His large and broad collection is displayed by the private Pinault foundation spanning a site in Paris and two in Venice.
Sotheby’s, by contrast, was taken private six years ago by French-Israeli telecoms tycoon Patrick Drahi, who built his empire through leveraged buyouts, often followed by deep cost cutting. When he bought Sotheby’s, Drahi himself was barely known to the art trade, even in France.
“Nobody sees him as a character of our field, just as a businessman,” says long-time culture journalist Roxana Azimi. “But it doesn’t mean the cultural field doesn’t do business with Sotheby’s. They do.”
Drahi’s acquisition marked the third time Sotheby’s had transitioned between public and private ownership since the early 1980s, but Drahi no longer owns the firm outright after selling a stake of between 25 and 30 percent to ADQ, Abu Dhabi’s sovereign wealth fund, in an October 2024 deal worth around $1 billion. Sotheby’s laid off 65 staff in December 2024.
“Every time Sotheby’s has been bought or sold, they do something to change it from the previous guys, whether it’s some new team members or premises,” says London-based art advisor Morgan Long. But successive leaders “haven’t fundamentally changed that much because there isn’t that much to change in their core business. It’s a bit of dressing-up. At the end of the day, is it that different?”
Those at the auction house today think so.
Sotheby’s Strategy Shift
“What is Sotheby’s? Not your typical auction house anymore,” suggests Lisa Dennison, the firm’s executive vice president and chairman for the Americas. The aim, she says, is to make the house’s core business “more relevant and inclusive,” particularly to “people who traditionally may have felt this is a bastion of elitism and we can’t go through those doors.”
The house recently struck a multi-year deal to host the Independent 20th Century fair at its Manhattan headquarters starting next autumn and a long-term partnership with Velocity Black, a members-only luxury concierge service, that will include private sales, educational events and other VIP initiatives.
Enabling these activations are real estate upgrades as unusual as they are lavish. In November, Sotheby’s will relocate its New York flagship to the Breuer building, a Brutalist landmark on Madison Avenue originally constructed as the Whitney Museum of American Art, after acquiring it in 2023 for around $100 million. June 2024 saw the opening of its so-called Hong Kong Maison, encompassing a ground-floor “retail experience curated by Sotheby’s” and a lower-level “space for immersive experiences and intimate personal encounters with art,” according to its architect MVRDV. Sotheby’s new Paris headquarters, which opened on Avenue Matignon last October, includes a café and wine cellar.
Tech is also central to the new Sotheby’s, Dennison says, portraying the house today as a place where publishing catalogues has been replaced by “mobile-first” business, and citing extensive upgrades made to its live-streaming capabilities, website and mobile app during the Covid-19 pandemic. Around 90 percent of bidding in the house’s sales is now done online, compared to 54 percent in 2019.
Underpinning all these changes was the decision to overhaul the house’s sales focus in response to shifting taste profiles. CEO Charles Stewart, appointed by Drahi to lead Sotheby’s in 2019 after a career in banking and telecoms, soon announced its restructuring into two divisions: “fine art” and “luxury.”
The multifaceted plan has been unfolding in stages. Sotheby’s has broadened its highest-profile revenue drivers — the twice-annual evening sales of fine art in New York, London and Hong Kong — to include lots by in-demand ultra-contemporary artists and undervalued historical figures.
But the firm also debuted new departments, such as Science and Pop Culture (later split into separate divisions) in April 2021; launched new initiatives including Sotheby’s Metaverse, a platform dedicated to selling NFTs; and acquired significant stakes in smaller auctioneers to expand its presence in complementary sales verticals, including classic cars and premier real estate.
“In the same way we took those art silos and broke them apart, we’re banding luxury — from jewellery to wine to sneakers to real estate — into one category where we can have a vision that focuses on luxury,” Dennison explains. “And then the luxury and fine art departments work to cross-pollinate.”
Christie’s Classicism
Christie’s, by contrast, has doubled down on a more traditional approach. “I see ourselves primarily as an auction house with a big sales segmentation,” said Alex Rotter, Christie’s global president. “We’re not here to reinvent the wheel.”
Rotter emphasised that Christie’s greatest asset in this changing landscape is expertise — not just at the top of the art market, where “nuance makes a difference of millions of dollars,” but also at middle- and entry-level price points.
Like Sotheby’s, Christie’s has made major real estate commitments of late, and they reinforce Rotter’s more orthodox vision. In 2024, it extended the lease on its long-time Rockefeller Center headquarters for another 25 years, then opened its own new Asia Pacific hub in Hong Kong across multiple floors of the 36-storey Henderson Tower. In comparison to Sotheby’s Maison, Rotter said Christie’s “went the more traditional way, because we’re there for auctions first and private sales second.”
Nonetheless, the house rearranged the contours of sales both inside and outside the fine art department. In May 2021, around six months before Sotheby’s restructured its marquee evening auctions, Christie’s established what Rotter called the two “super-departments” of 20th and 21st century art: the former including Impressionist and Modern works, the latter spanning work from the 1980s to the present. He explained the reorganisation in similar terms as Dennison, saying: “I can say with confidence the top buyers are looking across categories.”
Christie’s has pursued that mandate far and wide. The house acquired classic car auctioneer Gooding & Co. in 2024. It sparked an arms race for major dinosaur fossils by taking in $31.8 million (with fees) for a 40-foot-long Tyrannosaurus rex skeleton, nicknamed “Stan,” ahead of blue-chip Modern and post-war paintings in an October 2020 hybrid auction.
Shortly after selling “Everydays: the First 5000 Days,” an NFT by Beeple (aka Mike Winkelmann), for $69.3 million in a March 2021 online auction, the firm launched a dedicated digital art department (folded into Christie’s 21st Century Art department this fall). It followed up in September 2022 by debuting Christie’s 3.0, a platform for fully on-chain sales still operating today. The house also offers a broad range of sports collectibles, a category that grew out of Department X, a 2022 initiative for reselling high-end sneakers.
“I think the true nature of collectors is that half of them will collect anything that you can fascinate them with,” Rotter says. “If they come in through watches, bags, prints — that doesn’t matter.”
Although Christie’s has been working to improve its tech stack and the client’s digital experience since the pandemic, Rotter noted that he and his colleagues have been doing so “quietly,” explaining: “We don’t need to say, ‘This is the algorithm’ or ‘We’re working behind the scenes on AI.’”
That said, the firm in 2022 launched the Christie’s Ventures fund to invest in early-stage art-tech startups, led by Microsoft veteran Devang Thakkar. The initiative’s annual Art + Tech Summit attracts luminaries from both fields, but Rotter defines Ventures as “more of a tool than a philosophical shift.”
What Comes Next?
The emphasis on luxury goods makes sense for both Christie’s and Sotheby’s. Fine art makes up around three-quarters of sales at both houses, but the art market — worth an estimated $57.5 billion in 2024, according to the latest Art Basel & UBS Art Market Report — is a small fraction of the size of the luxury goods market, worth $386 billion in the same year, suggesting the potential upside is large.
And there’s some promise that clients who buy luxury goods will graduate to art. At Christie’s, over the past five years, 37 percent of its clients have bid in or bought from both its art and luxury divisions; and of those, 60 percent entered through luxury. At Sotheby’s, more than one-third of the house’s top clients transacted with both its fine art and luxury departments, with three-quarters of the house’s major watch clients and 81 percent of its major wine clients also actively buying or selling art.
The problem is that today the auction market operates on an extreme form of the power law: Around 0.3 percent of auction lots by volume made up roughly half of auction sales by value in 2024, per the Art Basel and UBS report. If the Three D’s — death, debt and divorce — are pushing relatively little onto the market, the houses rely on the fourth D: discretionary consignors, who tend not to sell when macroeconomic conditions are unstable.
Changing Christie’s or Sotheby’s fortunes with luxury will require some combination of gradually upstreaming clients from lower-priced collectibles to upper-tier art; more collectibles above $10 million; and exponentially expanding the buyer base such that volume displaces value as the chief profit driver.
None of these will happen quickly.
But as the trade’s two biggest players, they can play the longest game. “Auction houses are adaptable in ways other businesses in the art market are not,” Degen said. “For example, in the ’90s, Christie’s and Sotheby’s opened offices around the world, many of which didn’t end up working out. But you had the seeds of markets that became incredibly important to the business in the 2000s.”
Despite the new developments, the most persistent problem for attempts by Christie’s and Sotheby’s to outdo the other is that consignors and buyers both benefit from having two strong auction houses by playing the rivals against each other. So it’s fair to question whether any combination of expertise, marketing and innovation will ever reign supreme. And too much change too fast can be bad for business: Sotheby’s implemented an unusually buyer-friendly fee structure in May 2024, only to reverse course after seven months as numerous consignors and their art advisors balked and sales dropped.
Many in the field believe the new paradigms will fade to the background when death, debt and divorce unleash enough jet fuel to rev up the houses’ core competence selling top-quality art to hungry bidders. After bringing $136 million via a fully sold, off-cycle evening auction from the collection of Surrealist connoisseur Pauline Karpidas in September, Sotheby’s has lined up an impressive array of estates for the marquee November auctions in New York, as has Christie’s.
“To have a successful auction business going into 2026, I think they’re all going to be pitching for the same great material,” said Long. “I’m not sure what the big difference is that one can offer versus the other. It’s going to come down to the numbers.”
Read “Rethinking the Art World,” a four-part series rolling out this week, examining how the sector is being reshaped by new power centres, new forms of patronage, new approaches to creativity and the epic battle between Sotheby’s and Christie’s.
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