As billionaires get buffeted by the uncertainties of financial markets and new collectors are minted every day, auction houses are learning not to ignore material with fewer zeroes on the price tag.

Competition for the huge sweet spot that is the middle market has been heating up ever since Christie’s and Sotheby’s raised the buyer’s premium to a fat 25 percent of the first $20,000 (£10,000) last September. A few smaller outfits, such as London-based Bonhams and Bloomsbury Auctions, stuck with 20 percent, and they have been jumping for joy, sensing that the auction giants might shed a part of their lower-end business.

“We’re a small, niche auctioneer in books and works of art on paper,” says Tom Lamb, head of books and manuscripts for the Bloomsbury branch in New York, which opened its doors in Rockefeller Center last September. “For us it’s very good news, and as the new boys in town, we aim to please everybody.” In a sense, the breadth of that ambition reflects the reach of the middle market—practically everything that’s not ultraluxe, generally priced under $100,000. Doyle New York, another seasoned player in this category, has long specialized in a vibrant mix of collecting fields.

But for all their posturing about commanding a lead at the top end and coveting only blockbuster property, both Christie’s and Sotheby’s are still sweating the small stuff. “We’re really differentiating ourselves [from Sotheby’s] by concentrating on the high end,” says Heather Barnhart, regional director of Christie’s USA. “But we’re also investing and concentrating on the middle market.”

Christie’s gangbusters operation at South Kensington (£80 million, or nearly $150 million, in revenue in 2006), which typically embraces middle market items like movie posters and vintage cameras, will roll out an international brand of sales this month called Interiors—umbrella auctions covering multiple categories that will take place dozens of times a year in London, New York and Paris. These will offer a decorator-friendly, retail-style shopping experience.

Sotheby’s, too, is redefining its approach to this segment after shuttering its Olympia sales center in London in July and jacking up its minimum lot price to £3,000. It has recast its lower-priced auctions as “in association with” sales covering areas such as arms and armor, garden statuary and couture. These events are staged in different venues, including the house’s New Bond Street headquarters, in conjunction with independent outfits such as the Ontario-based RM Auctions, which specializes in vintage motor cars.

Of course, for Heritage Auctions of Dallas, the world’s third-largest auction house, this trend isn’t news. Founded in 1978, it made its bones in coins and has since expanded into sports memorabilia, movie posters and even Wild West objects. “When Google stock is selling for $700 a share,” says Edmund Pillsbury, chairman of fine arts for the house, “that’s not what every customer at Charles Schwab can afford or consider, so they buy other things. That’s the market where Heritage has had its success, in being antielitist and broadening the fun of collecting.”

"Middlemerch" originally appeared in the January 2008 issue of Art+Auction. For a complete list of articles from this issue available on ARTINFO, see Art+Auction's January 2008 Table of Contents.