Evolution of the business model for contemporary art galleries. Current situation and future challenges

Purpose - This paper aims at investigating the possible evolution of the business model of contemporary art galleries in the current international scenario. In the context of global crisis that has seriously affected cultural organizations, especially in Europe, the contemporary art market shows countertrend results. The art market, measured by auction results, has realized and is still realizing good and increasing performance, in terms of general sales and revenues. In particular, contemporary art represents a big business for auction operators, becoming one of the most profitable sectors in the art market. Despite this positive trend, contemporary art galleries are facing a difficult situation. With the exception of a handful of big galleries, many galleries generate only small profits and often they are compelled to close down their business. This apparently contradictory situation is strictly connected to the current business model of contemporary art galleries and underlines the need to rethink them in accordance with innovative ways of creation of social and economic value and fulfilment of a durable financial sustainability. Design/methodology/approach - The methodological approach combines the analysis of the literature with an empirical case study analysis. The goal is to explore the possibility of application of a successful business model in the field of contemporary art galleries. Consistently with this methodological approach, our paper is divided into three parts. In the first part we analyze the contemporary art market and the concept of business model in general, focusing on the current prevailing framework and the analysis of the literature on these subjects. In the second part we analyze a case of one of the most important Italian galleries: Galleria Continua. The in-depth examination of this case study leads to some evidence on the application of business strategy and management tools in the art galleries. More specifically the analysis of the business model of this art gallery is useful to identify a set of best practices. In the third and final part, in the light of what we have developed in the previous parts, we suggest some elements that could form the basis for innovation in the business model for contemporary art galleries. Originality/value - This paper aims at describing the present business model of contemporary art galleries and at proposing a new, sustainable one. In this sense, we think that this paper presents characteristics of originality. Moreover, another aspect of originality lies in the study of the role of an important reality of the cultural and creative sector, the contemporary art galleries. Especially in the Italian national context, the studies on contemporary art galleries are often considered secondary to those on "traditional" cultural organizations (like museums, theatres or heritage sites). Practical implications - The outcomes of the application are linked to the proposal of practical remarks for the evolution and development of business models for contemporary art galleries, as a new tool of creation of economic and social value in the cultural and creative sectors.