Trend-driven demand

What is trend-driven demand?

Trend-driven demand is the situation in which almost everyone suddenly wants a particular artist or type of work, because it has become what is currently worn. It is not the same as lasting artistic value, more the mood of the market at a given moment. Put simply, it is the appetite for whatever anyone who wants to be seen must have.

How does it work?

When a wave of fashion rises around a name, demand catapults its price sharply upwards, often to records. But that wave can recede just as fast, once the market's attention jumps elsewhere. The fluctuating value of some of Damien Hirst's series is a textbook example of how quickly an inflated price can fall back.

Why does it matter to a collector or investor?

Because trend-driven demand explains why some prices are so high, and warns that lasting value need not stand behind them. Anyone who knows this difference more easily recognises whether they are paying for quality or merely for the fashion of the moment. That is precisely why we never read a record figure as a guarantee of future profit.

What should you watch out for?

A wave of fashion can inflate a price to a level the work will not hold over the long term, and anyone buying at the peak may lose out later. So do not take an auction record as a guarantee but as a moment that may not last. It pays to ask whether the work will still be in demand once today's trend has passed.

— Anna Pulkertová, founder of Art Part Club