Last October, Phillips set world record with Paul Newman’s Rolex Daytona that sold for $17.8 million. Just last month, the Rolex Daytona “Unicorn” also set a new record for $5.9 million, way exceeding the company’s initial estimate of $3 million.

Auction houses are feeling bullish again, with revenues on the rise and several new pieces setting some new records.

Christie’s reports that it has sold 5.1 billion pounds worth of art and collectibles worldwide just in 2017, a significant increase of 26%  from its previous year. Similar positive outlooks were observed by Phillips, that revealed that it has achieved a total of $708.7 million in 2017 from auction and private sales, a 25% increase up from 2016.

One of the two largest names in the luxury auction market, Christie’s and Phillips, are privately held companies and net profits (or loss) are kept undisclosed. However, publicly listed Sotheby’s released its 2017 net income for 2017 back in February to be $118.8 million, a whopping increase of more than 60% from its $74.1 million in 2016.

These top-line numbers are a good indication of the growing market. According to Forbes, the global population of billionaires has increased to 2,043 and their net worth surging to a $7.7 trillion from the $6.3 trillion back in 2014.

Sotheby’s solid results came as total sales climbed 12 percent, and private sales jumped the notably by 28 percent. Tad Smith, Sotheby’s CEO, highlighted four areas that Sotheby’s plans to focus on: physical growth, its technology initiatives, “allocating capital wisely,” and continuing to assemble what he called a “winning team.”

Of these areas, the technological realm was explored most extensively. In January, Sotheby’s acquired the artificial intelligence firm Thread Genius, which helps identify collectors’ interests, and the auction house plans to continue expanding its digital reach. Online sales were strong in 2017, Smith said—23 percent of lots were sold to online buyers last year—and he hopes to continue that trend in 2018.

Technology is a huge game changer in the auction market now, as more traditional auction houses have yet to execute much changes to their business models since the 18th century. In the struggle to keep up with the global wealth and capitalise on the surging market, it is a “key moment for auction houses, which have struggled for significant profitability” to purse a “distinctively different strategy”, said by Edward Dolman the chief executive of Phillips.

Dolman stated the company’s “focus on areas of the markey showing significant lines of growth that follow the evolution of taste.”

Owned by the Mercury Group, a Moscow-based luxury goods distributor, Phillips has been holding art auction on key selling categories of 20th and 21st century design, photography and prints alongside the luxury watch and jewelry auctions that it is typically known for. Besides investment in high-profile specialists such as the recently appointed chairman, Cheyenne Westphal, they are banking on live auctions of art and luxury goods from the past century. However, less emphasis is placed on such, evident from the mere 2 online-only auctions held last year partnering with web platform Artsy.

Conversely, Christie’s is taking big steps for technological innovation, having held over 80 digital sales of luxury goods and lower-value collectibles in 2017, totaling up to £55.9 million. While the sum was a mere 1 percent of the annual overall sales, it represented 37 percent of Christie’s new buyers. Artemis, the owner company of Christie’s, that is controlled by French luxury retail magnate and art collector Francois Pinault, is focusing to establish a program of online-only auctions, with the primary aim to attract clients. The chief executive, Mr Cerrutis says that the art trade is “a market of unique goods and not so many buyers”, which makes the digital platform a great medium to draw clients who are interested in those pieces.

The clientele of auctions are fairly spread throughout the globe, from America, Europe to Asia, as observed from last year’s sales. While auctions houses are eager to expand their global client base to places of increasing new wealth, there are also certain categories in auctions that have been underperforming amidst the auction boom. Christie’s decorative arts departments have been cut smaller, with dwindling numbers of specialist auctions of English or French furniture.

As traditional collecting areas are slowly falling out of favour and auctions sales are generated by a handful of contemporary artists, it appears to be a tough challenge for the market to experience any leaps of growth. While valuable, one-time off consignments such as the recent series of Rockefeller auctions are promising means to raise annual numbers, auction houses “have to be very creative”, Mr Cerruti said.

Auctioneer Jussi Pylkkänen takes bids at the auction of Leonardo da Vinci’s “Salvator Mundi” during the Post-War and Contemporary Art evening sale at Christie’s on November 15, 2017 in New York City. (Photo by Eduardo Munoz Alvarez/Getty Images)

A stroke of brilliance, for example, will be Christie’s sale of Leonardo’s “Salvator Mundi” that sealed with a half a billion price tag in a New York postwar and contemporary art sale last year. Despite such marketing successes, it is also notable that Christie’s regular auctions of 19th-century and Russian art have took a downturn of 11 percent last year.

The market of course, can be boosted by higher prices. These sales are often complete with new buyers, who are attracted by the high prices that “signal a sense of quality, which reinforces the brand, creating a circuit at the top end of the market”, said Anders Petterson, managing director of London-based analysts ArtTactic. An extreme case in point will be a 1982 Jean-MIchel Basquiat painting that sold for a whopping $110.5 million to Japanese billionaire Tusaku Maezawa.

Diversification has not just been limited to marketing and content of auctions, but also the services provided by the auction houses. Sotheby’s for example, has expanded into areas such as financial serves; art advice, management of artists’ estates and even image recognition technology, employing a much more modern, 21st century business approach in contrast to its competitors. While the results are yet spectecular, it is worth anticipating whether more revenue will bear fruit from a more diverse business model.

At the current moment, the old world model of live auctions is still prevalent, keeping a good track of global economic growth.

“The market has rebounded in all categories and all geographical areas,” said Mr Petterson from ArtTactic that released a review of 2017 auctions worldwide back in January. “But we just don’t know how technology is going to change things. No one knows the endgame.”