Understanding buyer behaviour in the primary market for Aboriginal and Torres Strait Islander art: A cross-disciplinary study in marketing and arts management

Understanding buyer behaviour in the primary market for Aboriginal and Torres Strait Islander art: A cross-disciplinary study in marketing and arts management Thesis

Ehrenberg-Bass Institute for Marketing Science, Division of Business

• Author(s): Booth, Jessica A.
• Published: 2014
• Publisher: University of South Australia
• Volume: Masters of Research (Marketing)

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Abstract: The commercial market for Aboriginal and Torres Strait Islander art has contracted significantly in recent years (Commonwealth of Australia 2012; Newstead 2011; Wilson 2010a) after reaching a peak in 2007. Despite this downturn, production has actually increased with the expansion of government-funded Art Centres, resulting in an over-supply of lower and mid-range artworks, many of mediocre quality (Bendor, von der Heidt & Acker 2013). As the ‘fine art’ market is predicated upon notions of scarcity and high quality to maintain demand, some argue that a mismatch between supply and demand in the lower and middle markets (defined in this thesis as artworks sold for between $500 and $5,000), combined with the market downturn and persistent media reportage about ‘dodgy dealers’ and fake artworks (for example, see Rothwell 2006), has affected consumer confidence (Boland 2011b, 2011a; Liston 2011; Wilson-Anastasios 2011). However, little research exists on the buyers of Aboriginal and Torres Strait Islander art (Acker, Stefanoff & Woodhead 2012) and knowledge of their purchase preferences, behaviours and views on a range of industry issues remains ad hoc and anecdotal. Understanding consumers is fundamental to any functioning market (Calder 2001). In recognition of this, an established body of marketing literature exists on known patterns of consumer behaviour (Ajzen & Fishbein 1977; Auger & Devinney 2007; Belk 1974; Ehrenberg, Uncles & Hammond 1995; Holbrook 1999) in various product and service markets. It is widely accepted that in aesthetic product markets, taste plays a role in judgment and decision-making (Bloch 1995; Bourdieu 1984; Hoyer & Stokburger-Sauer 2012; Schindler, Holbrook & Greenleaf 1989). Consumers also use quality cues to make purchase decisions (Hamlin 2010; Ismail & Barber 2008; Lockshin & Hall 2003; Richardson, Dick & Jain 1994; Teas & Agarwal 2000; Verbeke & Ward 2006; Yuan 2005; Zeithaml 1988), and ‘trade offs’ occur among desirable alternatives (Johnson 1974). This cross-disciplinary thesis, engaging the fields of marketing and arts management, applied these constructs to the lower and middle price tiers of the Aboriginal and Torres Strait Islander primary art market (the market into which an artwork is sold for the first time), in order to better understand consumer choice in this market. Also explored were buyer awareness levels and perceptions of artwork provenance, available information and industry regulation, particularly the Indigenous Art Code (defined below). A two-tiered mixed methods study was designed and carried out by the author: 874 consumer surveys were conducted at three annual art-buying events in 2012 (Darwin Aboriginal Art Fair, Cairns Indigenous Art Fair and Desert Mob), then 20 in-depth interviews were conducted with both buyers and sellers of Aboriginal and Torres Strait Islander art. Provenance is “the place of origin or earliest known history of something” (Oxford English Dictionary 2013)–in this context an artwork’s source. Valued in all fine art markets (Athineos 1996; Burton 2007; Fritzke 2008), provenance is particularly important in the Aboriginal and Torres Strait Islander art market which, “like all raw, rough markets...has been plagued by problems, authenticity and provenance to the fore” (Rothwell 2009). Provenance is often presented in this market as an indicator of the ethical (or otherwise) circumstances in which an artwork was produced. As is done in many markets (Smith Maguire 2013), sellers of Aboriginal and Torres Strait Islander art leverage provenance in their marketing efforts, often foregrounding these ethical dimensions. This presupposes that buyers are concerned with the provenance of artworks they buy, and certainly in the higher price tiers of primary and secondary markets this is often true (Cole 2011; Gennochio 2008; Myers 2002; Taylor & Coleman 2011; Wilson-Anastasios 2009). However, there is little evidence to prove lower and middle market buyers value provenance. Literature on ethical consumption also tells us that there is often a gap between attitudes and behaviours in the measurement of ethical purchase choices (Ajzen & Fishbein 1977; Auger & Devinney 2007; Sharp 1997) and that “survey radicals turn into economic conservatives at the checkout” (Devinney et al. 2010). These constructs are investigated in relation to buyer interest in provenance in the lower and middle price tiers of the primary market. Business and industries develop codes of conduct (CoCs) with the aim of influencing the practices of supply chain partners, providing a baseline of expected standards for buyers and sellers (Mamic 2005). Where CoCs have the ability to enforce compliance they can be effective in dictating behaviour; though this is often not the case (Awaysheh & Klassen 2010; Emmelhainz & Adams 1999). The Indigenous Art Code (‘the Code’), a voluntary code open to all sellers of Aboriginal and Torres Strait Islander art, was designed in part to assist consumers in making informed purchase choices (Acker 2009; Australia Council for the Arts 2009; Eccles 2009; Raffan 2013). The Code, however, has limited enforcement ability, a fact that its Chairman, QC Ron Merkel, has described as "a structural flaw" (Raffan 2013, p.61). Further, the Code’s effectiveness is predicated upon consumers being aware of and utilising it to guide their purchase choices (Acker 2009; Eccles 2009). Despite this, little is known of how consumers perceive this regulatory measure, if they do at all –vital information given the Code’s efficacy in “creat[ing] customer demand for high ethical standards” (Haider, in Raffan 2013, p.60)is currently under scrutiny by the industry. Whether or not lower and middle market buyers feel they have adequate access to reliable information (on the market, on agents, or on the provenance of works they buy) to assist them in making purchase decisions was also unknown prior to this thesis. Using demographic, attitudinal and behavioural measures, this study sought to understand consumer profiles and purchase preferences in the lower and middle price tiers. Whilst demographic data did not enable great insight into buyers, attitudinal and behavioural measures did. As discovered by Belk and Groves (1999), whose study highlighted the need for a detailed examination of consumer profiles and preferences, a continuum of knowledge exists amongst buyers of Aboriginal and Torres Strait Islander art. Results from this thesis establish two broad consumer typologies –‘decorators’ and ‘collectors’ –with the former having little knowledge or enduring (Richins & Bloch 1986) or purchase-specific (Mittal 1989) involvement with Aboriginal or Torres Strait Islander art and being mostly guided by the needs of their interior space, and the latter having more specific tastes guided by higher involvement levels and their ability to perceive product quality (Zeithaml 1988). Whilst quality is a difficult term to define (Charters & Pettigrew 2003; Steenkamp 1989; Zeithaml 1988), this finding supports a broad segmentation of buyers based upon their involvement levels (Ismail & Barber 2008). However, involvement has, historically, been over-emphasised as a causal influence upon consumer choice (Sharp 2010), and certainly this thesis revealed a range of other influencing factors. The majority of buyers purchased from Art Centres, commercial galleries or art fairs, and few expressed resolute adoption of any one purchase method, supporting the idea that consumers are polygamous in their loyalty to agents, as they are for brands (Sharp 2010). Acrylic paintings were by far the most commonly purchased medium, suggesting that artists working in other mediums may be at a market disadvantage. 70% of survey respondents had spent under $500 on their most recent purchase, with obvious implications for the incomes of artists and agents. As expected, in light of the literature (Coleman 2004; Davies 2006; Hirschman 1983; Holbrook & Zirlin 1985; Hoyer & Stokburger-Sauer 2012; Lagier & Godey 2007), aesthetic appeal was central to the purchase choices of most buyers. Many also claimed that provenance was important (either in terms of its financial or intrinsic value, or as an assurance of agent ethics). However, as attitudes are often poor indicators of future behaviour (Auger & Devinney 2007; Sharp 1997; Wright & Klÿn 1998), the extent to which provenance and aesthetics are ‘traded off’ (Johnson 1974) when making purchase choices is not clear. Agent perspectives on consumer interest in provenance support the notion that some buyers over-claim this interest in terms of their actual purchase behaviour, perhaps reflecting the influence of social desirability bias (Bruner & King 2000). Across both samples, buyers expressed uncertainty about agent claims of ethical dealing and, as noted in the literature (Ariely 2008; Bolton, Warlop & Alba 2003; Butler 2000; Monroe 1973), pricing disparities and variations in product quality (Zeithaml 1988)compound this issue. The theory that consumers have a tendency to assume the worst (Johnson & Levin 1985), inferring negative attributes as substitutes for missing product information (Jacoby, Chestnut & Silberman 1977; Johnson & Levin 1985; Shapiro 1982; Sharp & Romaniuk 2004), was evident in these results. Finally, the majority of buyers were either unaware of the Indigenous Art Code’s existence or, if they were aware, did not utilise it when making purchase choices. This thesis makes an empirical contribution to academic literature in the fields of marketing and arts management. By identifying the profiles, purchase characteristics and criteria used by consumers to make purchase choices, it has tested existing consumer choice theories and contributes hitherto unavailable baseline industry data that will allow artists, Art Centres and agents to develop their offerings in a competitive marketplace. By creating new knowledge regarding consumer perceptions of a range of industry issues, this thesis makes a significant contribution that will assist decision-makers in understanding how existing policies and industry norms are being understood and utilised in the marketplace. Until now this information did not exist, and by creating it this thesis provides a descriptive base from which future research can be developed, with the aim of contributing to a more resilient Aboriginal and Torres Strait Islander art sector.

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• Publisher Location: Adelaide