Christie’s Dubious “Leadership” in 2007 Sale Results

It’s not that I give a hoot about who’s on top—Sotheby’s or Christie’s.
But what activates the needle of my sensitive journalistic spin-monitor are Christie’s representations about its sales leadership and superior profitability—claims that are, respectively, exaggerated and unsubstantiated.
In its Jan. 18 press release summarizing 2007 sale results, Christie’s included this gloat-quote from its CEO:
“In 2007 Christie’s once again led the art market in terms of sales, profitability and quality of works offered,” said Edward Dolman, Chief Executive Officer of Christie’s International.
Its sales leadership (including public auction sales and unreported private transactions) was statistically insignificant: 2007 totals, according to the Christie’s and Sotheby’s statements, were $6.3 billion and $6.2 billion, respectively. Christie’s reported a 36% increase in sales by dollar amount over the previous year; Sotheby’s, a 51% increase. Auction totals in 2007 were $5.8 million at Christie’s; $5.4 billion at Sotheby’s.
As for profitability, the operative word for Christie’s report is “murky,” not “transparent.” Sotheby’s, a publicly traded company, will release its audited 2007 results in late February, which will include its profits.
But privately traded Christie’s never discloses the amount of its profit, so we have to take on faith its claim to a larger haul. One wonders how Christie’s can make this comparison, when Sotheby’s results are not yet out.
By one indication, at least, Sotheby’s profits might turn out to be higher: It has adopted a policy of reducing the number of works it sells and focusing on high-priced lots: In its press release summarizing 2007 results, it reported that it sold “42% fewer lots than its competitor.” This might seem like a strange boast, except that by selling fewer lots for virtually the same dollar amount, the profit margin is enhanced.
Why couldn’t Christie’s just trumpet its impressive 2007 sale results and leave it at that? Otherwise, it should disclose actual profit figures, rather than make unsupported claims.