Negotiation Research You Can Use: Online auction buyers undervalue products sold by women

Online auction buyers undervalue products sold by women

By — on / Dealmaking

In our last issue, we described research showing that sellers with brown skin get worse deals in eBay auctions than sellers with light skin (results based on photos of sellers holding up items for sale). Now a new study finds a similar bias against products sold by women on eBay.

In their study, Tamar Kricheli-Katz of Tel Aviv University and Tali Regev of the Interdisciplinary Center Herzliya in Israel analyzed 631,516 auction sales by U.S. private sellers from 2009 to 2012 of the 420 most popular products sold on eBay. Women were the sellers in about 23% of the transactions; they had less experience selling on eBay than men, overall, but had better reputations on eBay than male sellers did.

Even when controlling for these differences and others, the researchers found that, on average, women received fewer bids for their products and ended up with lower prices than men did. For the 78,350 transactions involving new items, women received about 80 cents, on average, for every dollar men received. The gap was much more modest for the 553,166 transactions involving used items, with women sellers earning about 97 cents for every dollar men received. The researchers theorized that bidders may have trusted women’s descriptions of the condition of their used items more than men’s.

Notably, it is not always clear on eBay from a seller’s user name or other information whether the seller is male or female. The study included transactions in which the seller’s gender was unclear, suggesting the effect found by the researchers might have been more pronounced if the sellers’ gender had been uniformly obvious. In addition, it’s noteworthy that because sellers do not interact with buyers in eBay auctions, the negotiation skills of sellers are irrelevant and cannot explain the results.

The researchers also conducted a lab study in which participants placed a higher value on a $100 Amazon gift card when it was sold by someone named Brad ($87.42) as compared with when it was sold by someone named Alison ($83.34). Because a gift card is a uniform product, and ownership and usage of gift cards are not associated with a particular gender, the results suggest that buyers undervalue products sold by women. Why? The researchers hypothesize that people subconsciously assign lower status to items sold by women, a carryover from women’s historically lower status and enduring lower pay in the labor market relative to men.

The disheartening results suggest that as long as such beliefs (however unconscious) persist, women might benefit from selling new products, and perhaps used ones as well, anonymously on eBay and other online auctions.

Resource: “How Many Cents on the Dollar? Women and Men in Product Markets,” by Tamar Kricheli-Katz and Tali Regev, Science Advances, 2016.

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