The images below are all screen shots from the fantastic American Anthropological Association website on race. The first five are designed to show how we take what is in reality a nuanced spectrum and turn it into racial categories. In this first image, they show how we could, conceivably, separate human beings into short, medium, and tall based on height:
In this second image, they show how, by adding two additional figures, both taller than the tallest in the previous image, the way in which we designate people can easily change.
And this third image demonstrates how, when we actually consider all potential heights, where we draw the line between short and medium and medium and tall is arbitrary and, ultimately, not very useful.
Skin color is like height. If we just look at three groups with very different skin colors, there appears to be a significant and categorical difference between those three groups of people.
But, if we consider a wide range of people, it becomes clear that skin color comes in a spectrum, not in categories (such as the five from which U.S. citizens are forced to choose on the census).