Identification of brands as black, can pay off for companies

Labeling of companies as black cans Significantly increase their salesWe found in the last study.

In June 2020, the YELP business site introduced a function that allows consumers to search for black restaurants. As professors who study digitizationIN inequality AND technology economyWe were interested in understanding his influence. So we analyzed over two years of YELP data.

We found that restaurants marked as black, recorded a 65% boost in online traffic, more searches and connections and higher sales thanks to food orders and personal visits. These results suggest that for many ownership companies, a straightforward change in their visibility can create fresh development opportunities.

However, the impact varied depending on the location. The profits were the strongest in politically liberal areas and in places with a lower level of closed racial prejudices, measured by the regional variability of the results of an closed test. This suggests that the platforms partly manage, as opposed to creating customer demand. Interestingly, white customers fueled most of the growth, which suggests that the label helped raise the awareness of companies that they could not take into account earlier.

It was not just the 2020 trend in control analyzes we found similar results among companies that later decided on this function. We also worked with the Wayfair online furniture company, which launched “A”Black manufacturer“Label on its website in 2023 and stated that this led to a 57% boost in internet traffic. Finally, Yelp introduced a Latin label on the platform at the end of this year, which led to a similar boost in consumer involvement.

Why does it matter

This study affects company owners, digital platforms and decision -makers. The growing awareness of racial unevenness – partly guided by the Black Lives Matter movement, especially after the murder of George Floyd in 2020 – led to an boost in corporate interest and clients Supporting companies belonging to the minorities. This also led many companies to committing racial capital.

However, many companies have recently dismantled these efforts. For example, Target has recently announced that it eliminates his program to distinguish black companies. Our findings suggest that increasing the visibility of minority ownership-stroke an inexpensive change-can significantly improve economic results for own companies in black.

Our results also show that diversity initiatives are not only hot and blurred feelings. Companies should measure and evaluate their impact to ensure the effectiveness of their programs. A well -designed program can bring the benefits of the lower line, and the poorly designed risk is ineffective or even brings the opposite effect to the intended one.

That is why it is significant to recognize the potential risk. Earlier research, including Some of our ownIt indicates that disclosure of racial identity can sometimes lead to discrimination or slack. Although our findings suggest that labeling can have positive effects, poorly implemented policy may go back. The initiative of the YELP initiative enabled users who want to support black companies, enabling other users to continue their search in alternative ways.

This means that policy design is crucial. What you have is not only disclosed, but also how to communicate. Our analysis shows that customer demand and preferences differ significantly depending on the location and demographic data, which means that the context also matters.

Which is still unknown

Although our research suggests that companies have experienced economic benefits from adopting the label, it is significant to understand which policy projects work best in the long run. For example, the Yelp program used the OPT-in function that could contribute to its success.

However, there are open questions. How do companies labeling platforms affect? What other types of labels can influence, and for what types of companies? Can some interventions reverse?

Another key question is: which customers react to disclosure of racial identity? Recent progress in data analysis can assist companies improve their strategy, making it easier to direct the relevant consumer groups to obtain more effective initiatives.

Ultimately, our study is a step towards understanding how transparency and visibility can shape economic results. He emphasizes the initiative of diversity, which has benefited to both clients and companies, and provides a road map for companies that want to design initiatives that matter. What more broadly, he talks about the question that all companies are facing: How can companies better understand and shape their social trace?