Art Expertise: How to Compete with the Market’s Oldest Players Without Price Dumping

A cultural heritage expert Marina Nadeeva talks about the opening of an art authentication laboratory in Moscow during a crisis in the securities market and the growing interest of investors in the art business. Translation of one of the latest interviews.

I founded an expert laboratory specializing in art authentication at a time when it was particularly profitable: during a crisis in the securities market and a growing interest from investors in art. I faced tasks to formulate value propositions for clients that would distinguish my laboratory from the oldest players, and to enter the market without price dumping.

I received accreditation as an expert in cultural values from the Ministry of Culture. The accreditation grants the right to conduct expert activities. Under my leadership, more than 60 expert analyses were conducted in 2024, with an average bill of 200,000 rubles (2000 USD). Among the interesting orders were works with pieces by Anatoly Zverev, Vladimir Nemukhin, Lev Kropivnitsky, Kuno Amie, Vladimir Bekhteev, and Vladimir Tatlin.

A well-thought-out marketing strategy, a focus on a product approach, and as a result — an improvement in the quality of expert conclusions, contributed to a successful start in the new business.

What I did:

Studied market trends.
Studied the competitive environment.
Explored customer opinions.
Invested in equipment and engaged specialists from related fields.
Formulated value propositions.
Launched advertising.

Business in crisis conditions: external environment
In 2024, the Russian stock market experienced a decline. By mid-November, the Moscow Exchange index had fallen to the level of 2630 points. Trading volumes were increasing on the decline. The bond market also saw a downturn: prices were falling as the key rate of the Bank of Russia was rising. The Central Bank’s inflation forecast for 2025 is 4.5-5%, and the Ministry of Economic Development’s forecast is 4.5%. All this creates a fertile ground for the development of businesses in the field of alternative investments.

Before the rise in mortgage rates, real estate was considered a promising area of alternative investments. However, the Russian real estate market showed a decline. According to Gazprombank, the first half of 2024 was a period of decreased demand for housing by 25-35%. Investors began to pay more attention to the markets of precious metals, gemstones, and art.

The question of the reliability of the art market and the prospects of its investment potential remains open. Collectors regularly ask me whether they should sell or, conversely, buy valuable works. As an expert, in 2024, I advised to acquire art and not to rush its sale on auction platforms, the success of which is determined by a dumping strategy. Valuable works can be found for 100, 200 thousand rubles. The question is in their authenticity.

In 2024, the demand for expert services in art authentication tripled compared to the previous year, opening up new opportunities for business development. Collectors were motivated to verify the authenticity of works, import valuables from abroad, and return entire art collections to Russia.

Competitive environment
When launching a new business direction, I conducted an analysis of competitors and studied media materials, including publications about criminal cases. There were instances when experts with experience in the museum field were held accountable, including for fraud.

In 2015, The Art Newspaper published an article about crimes in the art market. For example, it mentioned the shocking withdrawal from Sotheby’s auction of Ivan Shishkin’s “Landscape with a Stream”, which, despite being authenticated by the State Tretyakov Gallery, turned out to be a retouched work by the Dutch artist. The investigation of the “Preobrazhensky case” was mentioned, where dozens of counterfeit paintings were discovered in a private collection, including works by the landscape painter Alexander Kiselyov. The respected community expert Vladimir Petrov was forced to retract two dozen of his appraisals. In 2016 a catalog of forged paintings was released, the total value of which could exceed $100 million. During the same years, media reported on the “Basner Case” – criminal proceedings (2012—2015) and the trial (2015—2016) accusing Elena Basner (who worked at the Russian Museum from 1978 to 2003) of fraud in the sale of a counterfeit drawing by the artist Boris Grigoriev “Parisian Café” in July 2009. Elena Basner was acquitted of the crime.

Echoes of the criminal past are still heard in 2024, although the art market is beginning to clear of fraudsters. This is due to both the emergence of new technologies and legal changes. But there are problems, and many of them. Collectors and investors who acquired art in the 90s and 2000s – a period of a surge in crimes related to forgeries – have approached me. And yes, forgeries verified by experts from the oldest laboratories were found in their collections.

Analysis of expert opinions that have verified forgeries showed that:

Even museum scientific staff with years of experience can make mistakes.
A common cause of errors is confidence in one’s own experience, which leads to neglecting work with archives (or fact-checking). An example of a mistake: a scientific staff member in their expert opinion refers to an exhibition in Saint Petersburg, which in fact was held in Moscow.
Neglecting online technologies and AI: even a search by images in Google Lens can refute the conclusions of an expert opinion.

After the scandals of 2014-16, experts stopped neglecting the method of technical and technological expertise, which led to a demand for the services of scientific laboratories. However, the older generation still dismissively treats archive research, relying only on comparative and stylistic analysis.

Laboratory research is a special topic. Before acquiring my own equipment and engaging experts from related fields (chemists, biologists, opticians), I faced difficulties, namely a situation where other market participants refused to provide me with paid technical and technological expertise services (or set prices 30-40% above the list price). In most cases, they tried to impose art expertise on me, which I conduct myself.

I took a risk and invested in my own equipment, and now I am increasing my advertising efforts. The effectiveness of the decision to act was confirmed by customer feedback. I used the information about other market participants that was provided to me to strengthen my business, enhance my service portfolio, and form unique value propositions.

Formation of value propositions
The decision to conduct an extremely thorough examination influenced the tariffs. The cost of my expertise is sometimes higher than that of the oldest organizations. For a while, customers considered this audacity – how so, barely a year in the market, and already high tariffs? To develop the business, it was necessary to convey to clients the importance of comprehensive art expertise, explain our approach to pricing, and talk about the value of our approach to art authentication.

Value proposition #1. Emphasis on a comprehensive approach. The approach to expertise is similar to a doctor’s work, who first diagnoses and then prescribes treatment methods. Similarly, I look at the artworks and determine the necessary types of expertise – technical-technological, comparative, and stylistic analyses. Together with colleagues, we decide what equipment will be required for each case. Is there a need to purchase additional equipment? Should chemists be involved? Biologists? Other art historians? Which archives should be studied? Which museums should be contacted?

If a client refuses the full set of necessary work to save money, we have to decline the contract. It’s impossible to confirm the authenticity of a 19th-century artwork without verifying its age. And to confirm the age, a technical-technological expertise and meticulous work with archives are needed.

Despite sanctions, artworks acquired or received as gifts in EU countries, including works by artists of the first wave of emigration, are still being brought into Russia. I have established contacts with European experts, including museum directors (which is not easy, considering the current political situation). I can turn to them if I need books, catalogs, or archival materials. Archives can provide information about the objects under study and historical data confirming their existence. If necessary, translators are involved – one worked on manuscripts in German.

Such an approach led to the necessity of setting high prices. For example, the minimum cost of authenticating valuable mid-20th-century artworks is about 60,000 rubles, and for the 19th century – 190,000 rubles. This is higher than some competitors, but justified by strict control, expenses on specialized equipment, and qualifications.

The role of a cultural values expert in the 2020s has changed: an expert today is not someone who will thoughtlessly sign off on conclusions just to receive a small fee. The value of quality expert opinions is growing. The list of accredited experts by the Ministry of Culture is impressive: it includes university professors, museum directors, and entrepreneurs.

Value Proposition #2. Mobility: to the airport at any time of day or night. One of the problems in the art expertise market is the lack of mobility among experts. Some do not want to travel due to age. Some work on a 5/2 schedule, limiting their ability to promptly respond to requests for expertise in the customs inspection zone (art is subject to mandatory declaration).

Not every specialist can urgently go to the airport to assess imported cultural values, regardless of the size of the fee. I made a decision: to go out at any time and to any airport, provided that the cost of services is quickly agreed upon. This decision bore fruit in the summer.

Value Proposition #3. Issuing NFT and RWA on our own platform. Together with colleagues, we offer additional bonuses to art expertise clients. Among them are the issuance of RWA (real world assets) or NFT (non-fungible tokens), which serve as proof of the artwork’s authenticity. We have our own NFT platform ArtCollecting.Fun on the Polygon blockchain, an NFT minter, and an RWA minter for issuing tokens on the Ethereum blockchain. The hash of my electronic digital signature on the expert report is added to the blockchain record. If the customer’s work is sold, the token is transferred to the new owner. This gives us a competitive advantage in the market amid the heightened interest of collectors in new technologies.

Value Proposition #4. Artificial Intelligence: saving customers’ money. We use artificial intelligence for a more advanced search for analogs of artworks through pictures and videos, which is more complex than Google Lens. For example, when analyzing a work presumably by Serov, artificial intelligence helped to discover its true author – a little-known Soviet artist, whose works were found on YouTube: the video showed an exhibition catalog being flipped through by an off-screen character. The oldest expert organization verified Serov in the “zeroes”. Artificial intelligence found the true author.

AI allows saving on costly technical and technological expertise and minimizing the risks of falsification. It will not replace experts but will assist them in searching and filtering data.

As the ArtCollecting team is involved in the web3 business, developing an AI application for art authentication became one of the priorities. Work on it began in 2023. I am involved in collecting data sets from databases of reference works.

Result: fewer disgruntled customers who are convinced that paying for expertise is only necessary if the authenticity of the work is confirmed. Those who do not consider the work of identifying forgeries as work can be directed to AI.

Although our application is still in development, I use it to analyze data. I quickly identify and verify unreliable information.

Advertising is everywhere
The foundation of marketing has become the formation of value propositions. In the advertisements, I paid special attention to expertise in the areas of customs control, the demand for which has sharply increased. Advertising campaigns covered audiences in airports, thanks to which it was possible to attract both corporate clients and private individuals in need of fast and quality customs clearance.

As it turned out, many collectors did not realize the necessity of declaring art, and targeted advertising aimed at airport audiences helped them quickly find relevant services at the crucial moment.

In addition to active promotion, not limited to using Yandex.Direct, I also applied other marketing tools. Among them is an affiliate program. I offer discounts to large corporate clients, banks, and family offices when the amount of a single order exceeds 200,000 rubles. This year, my services have found a wide response, thanks to high demand and limited competition, de facto — a shortage in the market of expert services.

Business growth
I perceive the development of my business as a process of increasing the collection of reference samples. The references are images of artworks with confirmed authenticity, usually part of museum collections. To expand our collection, I maintain connections with museums around the world. Directors of foreign museums are often interested in collaboration, especially when it comes to Russian art. This collaboration includes exchanging information that I can find in Russian libraries, translate, and send to them, making our interaction particularly productive. They provide similar services to me.

Museums also show interest in participating in experimental projects, including the development of datasets and training artificial intelligence, which we are currently working on. Expanding our collection of references accelerates the expertise process, as I always conduct comparisons with the references for each order.I perceive the development of my business as a process of increasing the collection of reference samples. The references are images of artworks with confirmed authenticity, usually part of museum collections. To expand our collection, I maintain connections with museums around the world. Directors of foreign museums are often interested in collaboration, especially when it comes to Russian art. This collaboration includes exchanging information that I can find in Russian libraries, translate, and send to them, making our interaction particularly productive. They provide similar services to me.

Experience shows: the higher the quality, the higher the demand. If you offer high quality, you don’t need to lower prices to get orders and withstand competition.

Related Articles

Responses