Race Matters for Online Sellers

Two economic researchers at Stanford University have just completed a year-long study that suggests race matters a lot when it comes to selling goods over the Internet.

The paid ads offered iPods for sale for hundreds of online sites across the U.S. The classified ads were accompanied by photos of hands of varying skin colors holding iPods "Black sellers do worse than white sellers on a variety of market outcome measures: They receive 13 percent fewer responses and 17 percent fewer offers," according to the study.

Here are a few other findings that small business people and entrepreneurs making use of online sales channels might want to keep in mind:

• White sellers with wrist tattoos fared about as well as black sellers in the survey when it came to getting offers and closing deals.
• The effects of race were most pronounced in the Northeast.
• The effects of race seemed to be canceled out in areas where there was lots of competition in the market.
• Racially "isolated" areas also have a pronounced effect on sales, making it more difficult for black sellers to close deals.