Consumers behaving charitably?

By S. McNamara & E. Doxey

Are charities keeping up with online consumer trends?

In an era of dramatic cuts to foreign aid and government support, Not for Profits (NFPs) find themselves competing more than ever for the support of individual donors. NFPs adopt various ways of distinguishing themselves in the market and of encouraging consumer behavior, increasingly involving heart-wrenching pleas on behalf of individuals in need.

So what is the best way to get consumers to open their wallets?

Recently an anti-poverty charity attempted to promote more positive imagery in a campaign – a huge move away from their traditional heart-breaking images. The amount of fundraising decreased – by about 20%! (They’ve since gone back to the tear-jerking pics).

In a series of experiments, it was found that people are much more responsive to charitable pleas that feature a single, identifiable beneficiary, than they are to statistical information about the scale of the problem being faced.’[1]

World Vision and Oxfam continue to use more traditional approaches to seeking donations by appealing to our philanthropic side. Newer NFPs, like Kiva have tapped into the younger generation, with smaller amounts to contribute, a “loan” system where you are effectively a financial investor, with a personal stake in following the project. Check out their campaign missions on youtube:


So, over to you.

How do you choose where to donate?  What can a charity do to appeal to you? How much of your giving is planned and how much is spontaneous or in reaction to a direct request?

Look at the sample advertisements below. Click on the one you think you’d be most likely to support.

charity-1Charity-3

charity-4Charity-2

[1] http://www.theguardian.com/voluntary-sector-network/2015/mar/23/the-science-behind-why-people-give-money-to-charity; accessed 27 March 2015

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20 thoughts on “Consumers behaving charitably?

    • Hi ccunnin – I’ve just noticed your comment was posted on your own page & didn’t appear here. Hope you don’t mind, but I’ll paste it below, because it adds another perspective:
      In the competitive space of charitable donations I have noticed organisations such as The Smith Family are targeting large organisations, gaining airtime with staff either on company intranets or face to face during employee forums and meetings and encouraging employees to donate, often through arrangements with the relevant company for donations to come automatically out of their salary. this is obviously an alternate way of securing subscribers to their organisations.

      Liked by 1 person

      • Thanks Lissa, it was my first reply and I was still finding my way around WordPress. Take 2;
        In the competitive space of charitable donations I have noticed organisations such as The Smith Family are targeting large organisations, gaining airtime with staff either on company intranets or face to face during employee forums and meetings and encouraging employees to donate, often through arrangements with the relevant company for donations to come automatically out of their salary. this is obviously an alternate way of securing subscribers to their organisations. Personally this approach has resonated for me and I will make a contribution out of my monthly salary with is debited out automatically……

        Like

  1. Great Post!

    I’m not surprised at all by the statistics quoted and find myself leaning towards the negative imagery rather than the positive. This suggests to me that consumers(myself at the very least) are more susceptible to negative reinforcement.

    I feel that most donations are credence purchases, It just seems impossible to actually evaluate if it has done any good. The generic updates charities sometimes send to regular donators don’t really provide any quantitative information in order to evaluate the purchase.
    Similarly, the usual statement of “$A can be used to supply B number of C to group D” also provide very little information on how your donation will be used.

    In answer to your questions:

    1) In my decision making process I subconsciously take a lexicographic approach. I generally go through a quick checklist, stopping immediately if one point fails:
    i) It must be a simply process that will provide a tax invoice.
    ii) I must be able to make a one time donation, no subscriptions.
    iii) It must be a recognizable organization, this makes me confident they will meet the core expectations of my purchase.

    2) Personally all giving is in response to a direct request, I simply don’t think to otherwise!

    3) It’s easier said than done, but for a charity to appeal to me I want quantitative information and to be truly convinced my contribution will make a measurable difference (or that the sum of 1000 contributions like mine does so).

    Cheers,

    Dan

    Liked by 1 person

  2. I quite enjoyed your blog regarding charities. It has been only in recent years that I have felt sufficiently well off to become a more regular contributor to charities. That being said I remain an adhoc contributor as I donate for overseas charity only in response to a major incident like the recent cyclone in pacific. I donate to domestic charities but again only in an adhoc manner such as for the Salvation Army door knock appeal or to one of their collectors in a supermarket. I also make adhoc payments to the Red Cross website.

    I would not say that I donate large sums of money and so I have problem with being sent a lot of marketing material or being approached by paid collectors. Because I dont have a lot to donate i dont like to see money being spent by charities on marketing campaigns, administration and paid collectors. I don’t think I am alone in having this issue with charities and yet I know it is unfair on them because if you don’t ask how do expect to receive. I think my issue is a particular challenge for charities to manage in terms of their marketing efforts

    Liked by 1 person

  3. The marketing strategy that comes to mind as the most effective recently is that involved with the ALS Ice Bucket Challenge. Obviously this was very successful and created buzz around the world. I found the below link on some of the facts involved, which are hopefully accurate. However, my comment would be I am not sure the charity, being ALS (Amyotrophic lateral sclerosis) Association did enough to promote the cause as I was not aware of the disease prior to doing this research.

    Liked by 1 person

    • Slide 15 sums it up perfectly.
      Note point 9: Not started by marketers. And no. 10.
      Even though social/digital media has been around for a while now, it’s proving difficult for non-profits to get their head around it. Saving up some money to take out a full page advert in the daily paper doesn’t cut it anymore, and internet marketing is still unknown territory for many small NFPs, because money is tight, so they want to spend it on tried and tested advertising.

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  4. I can recall on two occasions where I felt the need to donate. However, both were triggered by different methods.

    On one occasion I felt the the need to make a difference by providing financial aid. Having been blessed with a charmed life I thought it was only natural that I share this with others who a less fortunate. I recall researching various organisations, generally the larger and more well know ones i.e. World Vision, Oxfam, Red Cross. The criteria I used included the following:

    1) Trusted Organisation
    2) Low Admin costs to ensure the majority of the financial aid went to the people requiring it.
    3) Supporting causes that I could relate to.
    4) Assisting younger generations

    It was a very formal and rigid process I followed.

    The second experience was very different and much more spontaneous. During a work conference a guest speaker was invited to speak about his experience in supporting the aftermath of the Tsunami in Thailand in the early 2000’s. His personal experiences touched me and I felt the need to assist. Whilst I don’t recall going through the pre-purchase process, upon reflection I can see how his effective speech created a “Want” for me to assist this cause he was talking about.

    The way that he structured the speech he also provided a solution for me (without me knowing at the time) rather than having me develop one myself. It so happened that his cause ticked off a lot of the criteria I had previously identified i.e. low admin costs, supporting causes I could relate to, assisting younger generations.

    However, one criteria that it didn’t satisfy was the Trusted Organisation. I had never heard of his organisation but having been present at the presentation and being such a powerful experience I believe that this was what persuaded me in judging this organisation as a Trusted Organisation on the same footing as World Vision and Oxfam.

    Two very different pre-purchase experiences. The first being a very systematic and deliberate process. Where as the 2nd experience was much more impulsive but still satisfied my criteria that I used to determine who I would donate to.

    Liked by 1 person

    • Your second experience sounds interesting, because you got a personal account of what the charity did, and a personalised story to boot.
      This is effectively what NFP have been trying to do with many of the adverts – to put a face to a cause, with a hint at their story. Stroies are great connectors for us- we can connect to, empathise with and re-tell stories.

      Like

    • thanks for your comments, that’s a really interesting perspective and I think indicative of two major forms of charitable giving- in response to a direct request (having made a personal connection) vs a large charity which is able to rely on it’s brand.

      Its interesting that the larger the charity, the more comfortable people are that their money is being spent wisely. In many ways it makes sense, as we know larger charities have high reporting obligations as well as the natural oversight which comes with having a high profile.

      however, In my experience working in the NFP sector, smaller NFPs tend to be the ones which wring the most out of each dollar, while larger NFPs are comfortable incurring large overheads and sending money on costs less directly related to relieving the suffering they have identified as their need. When I am donating, i usually choose smaller charities because I know they have lower overheads and that every cent of my donation will be spent as I intended. But I am able to do this without spending much time on it because I possess some sector knowledge and I don’t need to spend time researching a smaller charity to be sure they are doing the right thing.

      Liked by 1 person

  5. Making consumer open their wallet, the first thing is to make them believe that their money will exactly put in the hand of people who they are willing to support. If the organization is not standard enough, people will not donate anyway. The more formal and rigid the process is the more consumer to donate…

    Liked by 1 person

    • Yes, everyone wants to think that they are actually making a difference, rather than just sending their money into thin air.
      While consumers do tend to stick with the tried and tested organisations, they do still branch out to new ones that they might never have heard of – i.e. ALSA.org, the beneficiaries of the ice bucket challenge. But only when there’s enough buzz surrounding it.

      Like

  6. Very interesting post. It is amazing what images can do to make us emotionally relate. If I select a charity it is generally one that I have a personal connection with. However it is very personal and effects everyone on a different level. I would certainly select a well-known, branded charity before one that is not so well-known or respected. At the end of the day, I am wanting to know that my money is going to end up assisting those in need.

    Liked by 1 person

  7. I agree with others that many people will not donate as they are afraid their donations are buying luxury cars for the charity’s CEO rather than getting to the people in need. Maybe charities need to promote their own ‘brand image’ as well as specific causes. The problem with that being, obviously, the lack of funds available to charities.
    I think many people give to certain charities because that particular issue has a special place in their heart. For example, someone who has a relative suffering from cancer is more likely to donate to a cancer charity. Animal lovers donate to the RSPCA. So maybe a bit more of locating the people who empathise with your particular charity are and approaching them exclusively would be a great place to start, although I am sure they are already trying to do that. An interesting blog thanks.

    Liked by 1 person

    • Yes, CEO salaries are brought up quite regularly when people discuss making donations. Charity Navigator in the US keeps track of CEO salaries & payouts, and the packages are usually associated with the size of the entity: http://www.charitynavigator.org/docs/2014_CEO_Compensation_Study.pdf
      (of course, it depends on your perspective of what is reasonable)

      Considering the size of some of those larger organisations, the budgets they’re dealing with and responsibilities, NFPs need a competant CEO in the role. How can they compete with corporate salaries?

      Large, NFPs (like the Salvos, Red Cross, etc) are then in a compromising position. Do they cut the CEO remuneration package to ease donors’ minds, or recognise that there’s a higher cost involved when heading a large organisation?

      Like

  8. An interesting article, just as I have finished reading an excellent book by authors N. Kristoff and S. WuDunn titled “A Path Appears: Transforming Lives, Creating Opportunity”. This book analyzes the art of giving, successful charities and consumer motivations.

    In contradiction to the “tear jerking imagery” theory you mention, the huge success of Charity:Water since its inception in 2006 has been put down to several key strategies. CEO Scott Harrison says “guilt has never been a part of it”. “Its excitement instead, presenting people with an opportunity: you have an amazing chance to build a well!” Their strategy consists of:

    1. A core group of rich donors pay for all administrative costs, so every cent donated actually goes to creating wells. This ties in with what a few commenters have mentioned above- the desire to see that your money is going towards action on the ground, not admin costs.
    2. Document everything with photos and videos. People want to see what they have helped to achieve. Perhaps some sort of self-gratification..??
    3. Use creative and irreverent marketing including social media to go viral. The use of donating birthdays on a website and raising money for charity rather than receiving gifts became hugely popular, tapping in to the group mentality of giving. If people see others giving it tends to encourage a competition effect.

    Personally, I support several charities through regular payments. I work in the environmental field and these charities are exclusively conservation and animal welfare based. The criteria for choosing them is non- emotional: previous success stories, proven results and scientific backing.

    I guess in the end it comes down to what you are passionate about and what charities you trust to do the most with your dollar.

    Like

  9. Yes, Charity: Water is one of those who have completely embraced a new model and obviously have great working relationships with their operation sponsors. Their financial model quietens the usual criticism that charities face – and effectively they have the same costs except they have two separate bank accounts: one for the company donors to pay operating costs, and one for the public to donate to. It kind of simplifies things!

    The birthday donation is wonderful, and yes, easier to get people on the party wagon when they see their friends doing it.

    Thanks for sharing- I’ll have to get a hold of that book.

    Like

  10. The blog post points out that people are much more responsive to charitable pleas that feature a single, identifiable beneficiary, than they are to statistical information about the scale of the problem being faced, this is as far from a rational response as you can possibly get. One would expect the scale of the problem to determine the amount of donations made. A question to be asked is that, is giving of this sort effective?

    Charities have moved a great deal towards understanding the behavior of consumers and the effectiveness of donations. In fact there is a global “Effective Altruism” movement that seeks to identify areas where there would be the greatest marginal improvement per dollar donated. Organisations such as Givewell actually analyze various charity organizations and make recommendations to consumers on which ones to support.

    I would probably donate to the Haiti Rice farmers where the donation could help the farmers to get their lives back on track after the natural disasters that happened in Haiti. More thought and effort needs to be put into place to actually track what charities do with donations and effectively relay this information to consumers. Even if this is done will it be effective, given that consumer donations are hardly driven by rational considerations?

    Liked by 1 person

  11. An Emotive Subject. Positive or negative advertisements are looking to touch a nerve with viewers, maybe trying to shock us into opening our wallets, and donating our hard earned money.

    One Christmas as a family we had finished a traditional dinner, and I was in a turkey induced coma in front of the TV. The “Vicar of Dibley” Christmas special was on, very funny, in fact really funny.

    The vicar is trying to get the villagers enthusiastic about the 20th anniversary of Live Aid and encourages them to write to the Prime Minister about the Make Poverty History campaign. However, when they show no interest, she shows them a short video depicting two poverty-stricken children. This is the only episode not to feature closing credits or a joke afterwards, the silence was enough for me to realize I can make a difference, and within 30 minutes had sponsored a World Vision child in Ethiopia, which only costs me four tanks of petrol a year, given it’s a tax deduction.

    I’m happy in my endeavour to make a difference, making extra donations at Christmas and trust World Vision to as they have Tim Costello is their CEO.

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  12. It’s an interesting article and I wonder, what would be the proportion these organizations are actually spending on the marketing rather than charity works. I have been a member of OXFAM and i receive a lot of calls and mails from them. When I was first approached by a volunteer I was given with some broucher and I felt pretty excited about being a part of it. Even though my contribution is a small amount, we cannot estimate the amounts they collect. The only answer I could give to myself is, If not everything atleast a part of my donation goes to the real charity work and I feel satisfied.

    Like

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