DONOR MOTIVATIONS: USING ACADEMIC RESEARCH TO UNDERSTAND NON-PROFIT GIVING
Air Date: February 19th, 2019
Steve Grimes, Director of Development Analytics and Strategy at Jazz at Lincoln Center,
discusses findings from academic studies that examine donor motivations. The intent is to provide a better understanding of what recent research says about the reasons why donors contribute to non-profit organizations. He also presents possible ways to implement their findings within general fundraising strategies.
HOST: Hey, good afternoon. This is Jay Frost speaking to you. And so happy to welcome you back to this session in the DonorSearch Flash Class series for 2019. If you’ve been following us since mid 2016, you know how many of there at these sessions we have had. We are bringing to you some new voices, top leaders in the field, certainly doing that today on topics that have great relevance to your work. And so very, very happy that you could be here today and share a session with us. Of course in the background is Hannah Krobock manning the controls and also our great communicator on all of these sessions. So afterwards you’ll be receiving a copy of the slide deck as we’ll be telling you about in a minute—that will coming direct from Hannah. But before we get underway, of course I’m going to take just a minute to reintroduce this platform or introduce it perhaps the first time if it’s new to you. I’m also going to tell you how you can get the content after the fact.
So do take a minute to gather your troops. If you’ve heard this before, get something nice to drink, make yourselves comfortable and I will go through a bit of housekeeping and then introduce our speaker. We’ll start with, of course, where you can get this content. As I mentioned, you’ll get the slides directly from DonorSearch, so if you don’t see them come into your email box in a couple of days, do just take a look at your spam folder. You might find them there and of course the recording will be along with all the others in the Flash Class Library at the DonorSearch site. So to find that, just go to that’s DonorSearch.net, then go to the Resources tab just like you see on your screen. The third item on that list is the Flash Class Library where you can see listing. They’re all right there.
This session will be posted there in just the next couple of days, so be on the lookout for that. It would be great to share with your colleagues who can’t be with you today. Now, of course we have silenced your microphones. So if there’s a stray dog barking or an ambulance flying by, we won’t be hearing that. But we do want to hear from you. So, once again, take a look for your GoToWebinar control panel. You can probably see that on the top right or left of your screen. And if you look for the middle section, that’s the questions tab where that arrow has now bounced into position, that’s exactly where we’d like you to go ahead and post any question or any comment at any time during the presentation. I will pull those all together and share those with our presenter at the conclusion of his presentation so that he can answer them in turn at that point.
HOST: But don’t wait, don’t hesitate. Go ahead and list them at any time—anything that comes to mind—I’ll share them with him at the end. And of course, you know what you’re here to hear today: Donor Motivations: Using Academic Research To Understand Nonprofit Giving. This is something that is so important and something that that our presenter today has unique insight on. It’s something that we frankly need a lot more discussion about.
So we’re so happy to have Steve Grimes, Director of Development Analytics and Strategy at Jazz at Lincoln Center here to share this with us. Steve has been doing this work for a long time and he’s been on both sides of the academic equation, both as a user where he’s going to share the insights today as well as having been a professor and followed the subject. Now, he’s at Jazz at Lincoln Center—an exceptional institution.
If you are not from New York and you go visit there–checkout jazz. Previously, he was prospect research analyst at the ACLU, working with the principal gifts team in their national office. Then, he furthered is career in 2006 as a prospect researcher at St John’s. He received his Bachelor’s in Psychology from SUNY Old Westbury, his Masters in Sociology from Saint John’s, a second master’s in Media Studies at CUNY at Brooklyn College, and completed his doctoral coursework at Rutgers where he was a Doctoral Fellow in Sociology before deciding to focus solely on his development career. So he brings that work where frankly being an Adjunct Prof at Cal State East Bay and all the way back to his work as a Special Ed teacher in New York and then applies that to some of the subject he’ll be discussing with us today. And with that, it’s a great pleasure to welcome Steve Grimes to the Flash Class stage. Thanks so much for being here, Steve.
GRIMES: I want to make sure everyone to see my screen, and it looks like we can. Thanks Jay for the introduction for everyone joining me, today and to DonorSearch for giving a space for me to talk about what academic research generally says about donor motivations when giving to nonprofits. I’m always happy to talk shop with other professionals in our field. So to get this opportunity to speak to so many of you today is a pretty exciting experience. So as my bio indicates, I spent some time as an academic, specifically in Sociology where much of the time was spent past studies to guide my own research.
And, in effect that was one of the more enjoyable aspects of the research process for me because it’s the little nuggets of information I was made aware of on the particular topic I was interested in. When one is reviewing academic studies, you can sometimes look at it as the equivalent of falling down a rabbit hole of infamy. But in a good way, where you come out a little bit wiser for the wear. And while books were useful for when I wanted to get a comprehensive viewpoint of an author’s understanding of a particular theory or phenomena, I found that academic journal articles were probably the most useful when I really wanted to understand the nuances particular topic because I could review different viewpoints of each study regarding that topic.
GRIMES: When I left academia and I came back to fundraising and I’ll submit, I really wanted to educate myself further towards the nuances of the industry, I utilized the power of what I knew journal articles could offer me towards that goal. So I started reading various topics and what it meant to work within philanthropy from an academic perspective.
Today I want to share with you some of those articles I’ve read, and specifically speak to donors’ motivations to give to nonprofits. My hope is that you’ll walk away with some strategies that you might want to employ to engage your donors, that are base in objective and empirical analysis of data. While I don’t suggest that one research study should be the end all and be all for how you direct your fundraising strategies, I do suggest that being aware of the insights from academic research and fundraising is another tool that allows us to have some measure to biases what in our day-to-day decisions as fundraisers. And much more than just being a check on our predispositions, reviewing academic research in fundraising reason forces us to keep in mind other approaches to our profession.
Depending when your shop, your main goal right now might be just to keep the doors open or something grander like starting a campaign. Either way, if it is a goal that is all encompassing and guides all other organizational directives, we tend to lose sight of the other fundraising approaches within our field.
That is, when we have our main directive blinders on, we tend to reify our biases of what we think works and what doesn’t work for our organization. I think immersing yourself, rather than just dipping your toe into the discussions that academic research has as it relates to fundraising mitigates that tunnel vision and helps us to be better positioned to think about other fundraising approaches that might benefit our organization.
So what am I specifically reviewing today? Well, first I want to keep an emphasis on providing top line takeaways from academic research. While I want to be a cheerleader for the benefits of staying abreast of academic fundraising studies, anyone who’s picked up an academic journal knows how dense that information that can be.
Many times, the authors are trying to answer multiple theoretical and methodological questions that can be confusing if you’re not privy to the arguments before it. For our time together today, my focus is solely to give you takeaways from that research that might be useful to us implementing our donor engagement and research strategies as fundraisers.
Second, I’m only reviewing articles where the authors have tested a hypothesis. What I mean by that is I only want to focus on journal articles and try to verify an observable phenomena as it relates to the motivations of donors. This is not to argue that other articles that simply discuss theory are not useful, but I want to keep this discussion mainly about the application of that theory that comes from research.
GRIMES: To that end, I’m only focusing on motivators for giving. I do touch on a few caveats that demotivate giving in this presentation, but for every study that gives a piece of evidence that supports one theory, I’m sure we can find another study that gives counter evidence.
So rather than trying to discuss both themes—what motivates and demotivates giving—I decided to just focus on the motivating today, and possibly in the future I may come back to discuss what demotivates giving. Now that I think about it, it actually might make an interesting webinar.
Third, I chose articles that were no more than 10 years old, although I do cheat a little. We should view research from academic journals as a continual discussion among academics that changes as new insights about our world are discovered. So while there was a great amount of exemplary research done 20, 30 years ago that covers all sorts of fundraising phenomena, much has changed about how fundraising has evolved in our world—and in general. So I want to discuss research that reflects that change, until it takes into effect that decades of research that came before into its methods and results.
Finally, like I said, my goal here really is to be a cheerleader for academic research as a source of info for our industry. So this conversation will not be exhaustive. There is a ton of information as to the motivations of donors, both inside and outside academia. In fact, there are entire degrees based on this topic and all the connecting issues. So we are clearly not going to be able to cover what all academic research says about donor motivations.
I want you to take our time together today as more of an opportunity for me to show my exuberance for these types of insights, and motivate you to go out there and take advantage of it. Plus, like I mentioned, I just like to talk shop with other professionals. Also, I should mention that when I talk about donors here with these studies, I’m generally speaking of donors at the lower level. While I definitely discuss donors at the higher level, most studies generally have giving insights about lower level folks as there’s an obvious problem of access to higher level donors within academic research. So do keep that in mind going forward.
So, now that I’ve set the groundwork for my intentions , let’s get into one of the main themes cited within academic research as to the motivations of donors.
One thing we see in research that defines such motivations is how needy the population is that they’re donating to. That is, research shows that when the organization effectively makes the argument for the need, that it is a key proponent for why donors give.
GRIMES: So how does research generally define what is effective to this end? Of course as fundraisers, we understand that the perception of need among donors is relative. Scientifically, this is a difficult dimension to measure. The different types of combinations as to what donors care about and what they see as needy are hard to give definitive conclusions to.
The authors of Do Contexts Matter for Willingness to Donate to National Disaster Relief? try to give an answer to this by distributing questionnaires to respondents regarding 50 natural disaster scenarios and [asking] whom they felt needed more assistance or who they would subsequently donate to because of that disaster. They found that when controlling for the different types of populations affected by the disaster, but ultimately the better description of need, that is, when the extent of the damage was thoroughly explained, the more likely someone was going to give to fixing the damage of that natural disaster.
And while how well we describe the need in our solicitations to our donors is largely within our control, we usually have less control over the type of need that we’re soliciting for. The authors of Eliciting Donations To Disaster Victims: Psychological Considerations bring to light that natural disasters do take precedence over manmade disasters in donors’ minds.
When they gave individuals the context of natural world disasters—for example, Hurricane Katrina—versus manmade disasters—for example, the civil war in Sudan—and said that they could either give to one or the other, or asked the respondents which one should get more contribution than the other, the natural disasters won out every time and [impacted] how much the donors were willing to give. I think that the study is just a window to the complexities of the context of need, at least in this case, where donors will justify who to tribute to depending on not just who deserves it more, but whether there is a perceived responsibility to be placed on the recipients in need.
In this case, the authors of the study showed that when there’s little responsibility attached to the recipients’ predicament, they went out for that donation. But while that study does show that donors take into account whether the recipient is responsible for their predicament into their contribution decisions, there is evidence that shows that once the donors are exposed to the lived experience of those in that predicament, they are likely to give, versus when they are not exposed to those lived experiences.
The authors of Buddy, Can You Spare a Dime? Homelessness, Panhandling and The Public tested by seeing how being exposed to being homeless changes a donor’s behavior to that regard. Using survey data from the National Survey of Homeless Assistance Providers and Clients, they wanted to see if individuals generally gave more to panhandlers when they had continued exposure to the homeless and their living conditions.
GRIMES: They found that when donors were more exposed to aspects of what it meant to be homeless—for example, where they slept, what they ate, their safety—they were more likely to give to the panhandlers. And while panhandlers are not nonprofits, they do represent the idea that donors need to be educated, and likely exposed to a cause to properly motivate them to give. And nowhere is this more apparent than being close to someone who’s a victim of an affliction.
In Friends of Victims: Personal Experience and Prosocial Behavior, the authors asked: Does knowing some someone with an affliction and make them more likely to give to causes that eliminate that affliction?
The authors had an interesting way of going about this project. They matched up individuals by two and gave both individuals $10. They then had those pairs get to know each other. They made it that one person of each pair lost $10. After that, they shuffled the partners around where some pairs no longer had the original partner. They hypothesized that individuals who had their original partners were more likely give more of their $10 over to a scholarship fund for needy children than individuals who now had a new partner. Without getting too much more into the method of the study, they did find the individuals who were paired back with their original partner were more generous [inaudible] scholarship.
They then manipulated the results further by providing an environment where partners got to know each other in passing or more closely, and created the same scenario. Original partners who had a close relationship to the partner were more generous to the partner and that cause than those who got to know their partner only in passing. That study is a great example of the care that should be placed on who nonprofits use as the face of the organization, or, more importantly, the cause that they’re trying to address.
In other words, I think the results speak of knowing your audience and not just what they care about, but whom. I do want to touch on, a little bit further, the dangers of using peer to peer fundraising as a motivation for donations later on. But one last note about need as a motivator. That is, that need does not always have to be contextualized as the cause to be donated to. But the need of the nonprofit itself can be the motivator for donations.
In When The Relatively Poor Prosper: The Underdog Effect On Charitable Donations—the authors were interested in whether donors are more apt to give to charitable orgs that were further away to their goal than an org that was closer to their goal. They set up a crowd funding website that showed how much the charities received, and they found that recipients were more likely to give to the charities that received less.
GRIMES: Even more interesting was that, when the idea of thresholds were introduced, respondents were even more likely to give to charities that were further away from their threshold than those who were closer—even if that threshold didn’t seem attainable. Now, these scenarios were tested in using crowdfunding methods, and in the context of giving to one charity and not the other, but it is very interesting to see this take place when we know, as fundraisers, that the efficacy of the charity is key in the donor’s decision. Clearly there are some other factors that we should take [into consideration], keeping that relationship in mind.
Speaking of efficacy, this is another factor that we’ve seen in academic research as motivating giving. Simply put, donors want to know that the money that they’re giving organizations will use their funds and appropriate manner. This is the case even when your normal donor doesn’t fully grasp the initiatives they may be donating to or haven’t done the comprehensive research on the charities to understand how active they are. That said, we would be daft to ignore the results of studies that show when donors have done their research and/or are made to see where the money’s going. It’s clear that they will give and give more to organizations who at least LOOK like they know what they’re doing.
Returning to the crowd funding for a moment.
HOST: Pardon me, Steve? We’ve had a couple people say that they’re having a little difficulty with the quality of the sound. I’m wondering if maybe you should try either without the headset or a moving the headset a little bit away. It seems to be good at providing some choppiness today in the audio.
GRIMES: I will take the headset off and go from there. Can you guys hear me now?
HOST: Oh yeah. Actually I think that may have saved it. Thank you very much.
GRIMES: Great. All right, so I am so sorry if you did not hear much of what happened in the past 10 minutes or so. Hopefully, the next 20-30 minutes will be useful for everyone. My apologies guys.
So, returning to the crowd funding environment for a moment. The authors of Effects Of The Price Of Charitable Giving: Evidence From An Online Crowdfunding Platform wanted to test to see if donors saw how much of their donation went to the cause and how much went to fees, whether that would determine to whom and how much they gave. Using charities at DonorsChoose.org, they found that when a charity had higher fees, they received less than their counterparts in the amount and number of donations received. There may have been some sort of intermingling effect of the ease of choosing other charities over others within the platform that swayed decisions, but I felt the study was a good example of what happens when donors have a choice of what to give to, are clear in their understanding of where the money is going, and fully comprehend how much that money is being used for the cause solicited.
GRIMES: So far, much of the studies I’ve touched on or have been speaking to are donors at a lower level. And as you know, while lower level is a relative term, I think we have a general understanding of what a higher level donor looks like. They’re generally more interested in the internals of the organization than the lower level donors, and thus are more thorough with their research and discerning with their giving decisions.
One second. Having a bit of technical difficulty with. There we are. Alright. Let’s start from this slide, and move on.
So, one way those types of donors can take on that research is to go through our org’s 990. This is what the authors of The Effect Of Nonprofit Governance On Donations, wanted to test. What they wanted to see was the effect of a revised 990 on donations. They hypothesized that, when orgs made changes to their 990s, where they were more accessible, were clear on the policies included, the inclusion of an audit committee, clear on the compensation offered to the staff, inclusion of the makeup of the board, the makeup of management, and documentation of board meetings—That these aspects would correlate highly with higher donations to that org in comparison to when they did not offer that information.
While they did find that there wasn’t an increase in low level donors, when that change happened, they DID find that it was correlated with donations from higher level donors.
We could argue that what is really happening here is that better 990s are really showing that the organization got their act together. However, this result was reinforced by the insights given by another study: Financial Report On Factors Affecting Donations To Charitable Organizations. Here, after conceptualizing and categorizing the possible perceptions an organization gets from a 990, the authors found that the 990 is able to give the perception of efficiency and stability, or when the 990 is able to give the perception of efficiency and stability that reinforces the reputation of the org, it is positively correlated with larger donations. This insight is likely not new from our perspective as fundraisers, but I think what is interesting here is that the research also backs up the differences we see between the motivations between larger and smaller level donors. And while I would love to get into the differences between those two, I think maybe that’s probably another webinar.
One more study I wanted to touch on shows how efficiency is important to donors. As Multiple Information Signals In The Market, For Charitable Donations has noted, an organization’s 990s are really used by probably your most invested and discerning donors, and that it’s likely not to be utilized by the large majority of your constituents to make their donation decisions. Charity rating sites like CharityWatch.org, however, are likely the more popular choice with most donors, and this study sought to understand what effect they might have on donations. The authors found that nonprofit orgs rated by at least one rating agency received more donations, relative to nonprofits that were unrated.
GRIMES: Further, there was an incremental increase in donations to nonprofits that received additional ratings, and that both positively rated and negatively rated nonprofits in fact, received a higher level of direct donations relative to unrated nonprofits. But of course they document that nonprofits that received a positive rating are associated with a higher level of public support relative to nonprofits receiving a negative rating. Additionally, we should keep in mind that just being listed on the sites is not the end in itself. Donors value consistency across rating agencies where orgs with differing ratings are valued less by donors than those with consistent positive ratings.
I do think that these results from all these studies speak to another theme you’ve seen in academic research as to what motivates donors. That is of social norms and conforming to those norms. We can argue that beyond the personal benefits, donors want to give to organizations that are socially acceptable and causes that are deemed socially important. And, what’s acceptable and what is considered important is relative. There are a few studies that do a pretty good job of showing that there are some universal social incentives to motivate giving.
Returning again to the crowdfunding environment, in Majority Size And Conformity Behavior In Charitable Giving, the authors were interested in if the prior amounts donated by other individuals motivated future donors to give more in their donations. They found that the higher the last five modal amounts, the higher the donor gave. That is, the higher the last five amounts that were indicative of that charity, the higher a person gave. But again, this took place at the lower level amounts so we have to keep that in mind.
The power of the crowd was also seen in Do You Enjoy Giving More Than Others? The Positionality Of Voluntary Contributions. The authors were interested in whether the visibility of the donation motivated the donor to give more or less. Through questionnaires, the authors gave respondents giving scenarios where the respondents knew how much others gave and whether their gift would be visible to others. They found that, when other gifts were visible to the donor, and their gift was also visible to other donors—and the respondents were given a choice of what to give—they generally chose to give the minimum as long as it was higher than other gifts. Again, this took place at the lower level. This brings me to one of my favorite studies from a methodological viewpoint. Part of what the two previous studies show is that when the act of donation is visible to others, it performs very differently as to when the act of donation is not visible.
The authors of Eye Images Increase Charitable Donations fully commit to understanding the foundation of this concept by testing whether Eye Images themselves—or, I should say, eyes themselves—motivate giving. The authors took the containers that you see in stores that asked you to give to a particular charity, and prominently placed, on one container, cartoon eyes—about three centimeters large.
GRIMES: On another container, something with just stars half the size of the eyes, and those were all prominently placed on the container. There were theories that direct gazing eyes are able to increase prosocial behavior. The idea here is that humans have evolved to be sensitive to being stared at, and thus conform to social behavior when that takes place. If we were to argue that being charitable is a social norm amongst capitalistic societies, that when one is gazed upon and asked for a contribution, they will likely look to follow the norm of what it means to be charitable. And unbelievably enough, in all of their tests, they found the container with the eyes received more money than the one with just stars.
GRIMES: Now, I am not definitely suggesting that when you are asking for donations in person that you slap on googly eyes.
HOST: Steve? I think we’ve lost your audio. Okay, hold on folks. We’re gonna get through to Steve and make sure that we’ve got your audio back on there. Just one second. Bear with us. Okay. I apologize for the delay folks. We’re trying to reach out to Steve. Apparently he must’ve lost his Internet connection where he is. So stay tuned with us for just a moment if you will.
Again, our apologies everybody. We’re in the process of reaching out to Steve and we’ll be right back with you. Thanks so much for your patience. This is also a good time in case you have any questions…[inaudible].
GRIMES: So my computer has never crashed on me ever. I’ve had it in the past couple of years and of course today is the day I have to just go ahead and do a webinar. It crashes on me, just as I’m talking to about googly eyes.
HOST: Well it must have been a hex. Yes, it was the googly eyes.
Absolutely. The best luck. Let me just power up the PowerPoint one more time and we’ll keep on going and I am so sorry guys. I am absolutely mortified about this…While you’re powering up as Steve and getting that running. I want to encourage anyone who might have a question about any of that subjects that Steve’s been providing a boatload of information for us. There is real information instead of anecdote about what drives donor behavior from all these different perspectives.
If you have questions or thoughts about this, this is a perfect time to go ahead and note those now in the questions tab. If, for any reason there’s additional difficulty Steve has with his machine, which is possible in our world where we are sometimes a beholden to our technologies, at least that can inform him for a reprise of this session, because, clearly there’s a lot of demand for actually knowing what is underlying what people do and what we can do to drive more effective, efficient donor behavior insight on donor intent. So go right ahead and feel free to post any question or comment while he’s doing that. And Steven, when you’re up, let me know.
GRIMES: I’m up and running with my PowerPoint.
HOST: Sure. In fact, Hannah can go ahead and send that prompt you again…
GRIMES: Give it another second or so, it should power up at any second. Beautiful. Again, I am so sorry guys. It’s funny how these things work out. All right, so let me go back to googly eyes. Yeah. so like I said, I’m not suggesting that when you are asking for donations in person that you slap on googly eyes on everything within arm’s reach of the donor. But I thought that that study was a great example of how academic research can help you think outside the box to get the most out of your donors.
We have to keep in mind the dangers of motivating donors through social norms. In truth, the guilt of not following a social norm is a key motivator for engaging with donors as as An Exploratory Study Of Existential Guilt Appeals In Charitable Advertisements shows. Through focus groups, the authors found that ads that mainly evoked guilt were effective in getting more donations. However, this was usually in response to the donors wanting to lessen their guilt and not because they uniquely cared about the cause. This, however, did not mean that the organization was seen negatively by the donor. If the organization was well known by the donor. In fact, in advertisements themed by guilt, the view of the organization stayed positive among those donors. However, eliciting donations in this way has the danger of engaging donors with a short term approach, um, as that alleviating their guilt is a very different experience than what it means invest in the organization and be invested in the cause. Much more, the authors find that, when the organization is not very well known by the donor, negative feelings can be attributed to the org that produces the advertisement.
But we can view guilt as one of the many negative outcomes one can experience when they have not acquiesced to [the] social pressure that comes along with being charitable. Another outcome is Social Exclusion, which, when a person wants to avoid it, can be a strong motivator to donate but not really a motivator to stay with the organization as Reluctant Altruism And Peer Pressure In Charitable Giving shows. Through experimental methods, the authors wanted to understand if giving among paired individuals as opposed to giving by oneself in a fictional situation was due to their altruism or their pressure of being paired with someone. They found that being paired with someone increased the amount and how many times someone would give. However, this increase giving came at a price.
Generally, individuals in pairs felt that their giving was due to peer pressure, and subsequently had negative feelings for a charity they donated to. This has implications for fundraising through Peer2Peer or ambassador programs, as we can argue that the crux of these approaches are highly characterized by pressure from someone who’s respected or close to the donor. An argument can be made that the donor is giving to the friend rather than given to the organization.
GRIMES: To that end, and tied to social norms as a motivator, there is a decent amount of literature around the idea of cost to the donor as a motivator. This comes from the thinking that humans are rational actors, and we weigh the cost to ourselves in the transaction before we make a decision.
Wherein a donation to a nonprofit is a conscious decision that requires deliberation on the donor’s part before the contribution is made. I thought it was wise to include some of the literature of cost in this decision. For example, we can see how donors see costs in the ‘round up’ type of donations. The authors of Would You Like To Round Up And Donate The Difference found that roundup donations are more than just convenience for donors, it reduces the pain of what it means to contribute. For example, in the same sort of scenario where roundups are asked for—usually when paying for a product at the point of sale—we can argue that asking for a round up versus asking for a fixed amount to donate, for example, when the cashier asks, “Would you like to donate a dollar to the charity?” The latter has a very different effect. That is, there is a ‘pain’—and I use pain and quotations here—that comes from donating a fixed amount that was asked for. The cost is exacerbated if we consider that the customer is likely to look at the fixed amount as a transaction where they’re paying for something intangible with their likely very tangible product in many scenarios. In the roundup approach, the donation is framed as part of the original purchase, which takes away the idea that the customer has paid for something that they haven’t seen and lessens the idea that they have gotten something for nothing.
And it’s important to note that thinking of cost is a phenomena that is significant for all donors across the economic spectrum. The authors of Feeling Poor, Acting, Stingy wanted to know what were the factors that motivated richer donors feel as if they were not able to contribute to a nonprofit. They found that when donors who felt inadequate about their financial situation and had feelings of wanting to hold onto their money, the cost attributed to giving to a nonprofit was higher. I think that this study speaks volumes to the utility of Planned Giving programs within charities that can be in a position to educate higher level donors about the investment options of their contribution to mitigate their perceived costs.
Costs can be mitigated in other ways. One such widely used tactic is the approach to use matching gifts to spur giving. The authors of Does Price Matter In Charitable Giving, wanted to understand the effect of a matching gift in securing a contribution.
They hypothesized that a matching gift—at least 1:1—would bring in more donors and higher dollars than no option for a matching gift and found that to be true and most of their tests. They however found that larger margins did not help increase donors nor donations. So the effect was really only saw significant gifts at the one to one level.
GRIMES: But we can theorize here, among other things to be sure that a donor recognizes a matching gift as added value to their contribution, thus a lower cost on their end. The thinking here might be, from the donor’s perspective, something along the lines of I’m going to give $2 to this organization but it’s really only cost me $1.
Finally, cost, of course, is key to the solicitation process. We don’t want to ask too much and we don’t want to ask too little when soliciting a donor. Put another way, we want individuals as donors and would rather have the financial engagement then none at all. So, in some cases we can leave the contribution amount totally up to the donor and have them give whatever they believe is needed. Or, we can ask them what we feel the appropriate amount is.
The authors of Charitable Giving And Nonbinding Contribution Level Suggestions tested to see which is more effective to cultivating and bringing in donors. They found that when presenting individuals with no gift suggestion, a $100 ask, or a $200 ask, higher level gifts came in at the $200 level. However, in their studies, not everyone gave $200. It was like 175, 180. But there was less participation at the $200 ask than any other level where there was no gift suggestion.
There was a significantly higher participation with lower levels of donations. As fundraisers, we do this already when we break down our constituents between major, mid, and lower; and make appropriate asks to those segments. Ultimately, we don’t want to send out asks for donors who are unable to give at an inappropriate level.
I think the study does a good job of reminding us that segmenting our asks at the lower level is important also. That is, depending on your org, it is better to bring in donors at whatever level they find appropriate and cultivate them to something higher than to lose them completely because they saw the costs of donating as too high.
So, personally, I am fascinated by fundraising in general. In our economic climate, it is a learned behavior that can be in competition with other economic behaviors. I think academic research helps them makes sense of what we consider to be to be not really an intuitive part of most people’s personalities.
As fund raisers, we are always happy to solicit someone who already knows what it means to be charitable. But there is a significant amount of work that goes into teaching those who don’t fully understand what it means to be charitable into that way of thinking. I am a huge advocate for the benefits of reviewing academic articles that give us insight into how we go about that process of educating our donors—Not just about our causes but what it really means to be charitable.
GRIMES: So thanks again for taking the time out today to listen to this presentation. I am so sorry for the technical difficulties, but I do hope I swayed everyone to go out there and do their own research. With the little time we have left, I’m open to questions about any of these studies or anything else that came up as I was talking about these insights.
HOST: Steve, thank you so much. I know it’s petrifying when technology doesn’t cooperate, but I have to tell you, there were so many people just saying, don’t worry about it. It’s fine. We’ve been there. And we do have lessons too. So I just want you to know that people stuck with you because they understand, but also because this content is so important and I personally appreciate you went through so much literature and actually presented some facts to things we talk about but rarely have any data on. But I’m going to be quiet and read some of these great questions. And we start with Astrid, who asked early on: If I wanted to do some research into scholarly insights applying to my organization, how would you suggest that I get started?
GRIMES: Great question, Astrid. There are a bunch of ways that you can go about it. When I was teaching, I generally taught my students to use Google Scholar. I felt that that was the best way to get a full grasp of everything that’s out there. And if you think about the research process as like a funnel, you start at the top where there’s a ton of information already available, and you’re just trying to filter down to something that is going to be useful for you. It is beneficial to start with something like Google Scholar that is an aggregator. So again, I’m not sure if you guys can see my screen and I see it’s kind of going in and out. Jay, can you see?
HOST: Yes, yes, it’s perfect.
GRIMES: Great. Let’s say for example, you wanted to look into peer to peer fundraising, and you wanted to find some sort of way to go ahead and make an argument that peer to peer fundraising works for whatever the reasons. Obviously going to Google scholar, you can do your search and you get a whole bunch of things. But the beauty of Google Scholar—and one of the harder parts of research—it’s not just going to find one article or two articles, but a bunch of articles that allow you to kind of get into that nuance, those different perspectives, to fully grasp exactly what you’re about to get into. So one of the beauties of Google Scholar is this ‘Cited By’ link when you are actually in a topic or a paper that you feel is like super useful and gets everything that you’re looking for.
GRIMES: Obviously, in the paper there were the references that you can use, but the ‘Cited By’ allows you to look at articles that were cited by other researchers for their articles. So what will happen is let’s say–I’m not sure when this particular article was written—but let’s say it was 2003. This page here will go ahead and give you all other articles that came after this article that builds on those results, that builds on those insights. So that you are:
- fully grasping what this article is doing, and then
- getting additional arguments, insights, you know, really fleshing out that research.
Again, it’s, it’s not the most quick way of dealing with things, but it definitely allows you to kind of get a full breadth of what’s being talked about within academic communities.
In terms of actually getting access, there are a few publishers that will allow you to have the first five articles for free. It’s usually the bigger publishers. Ever since there’s was a big hubbub about a lot of these articles being locked behind a paywall, the publishers have been doing a better job of allowing people to read articles for free. If you’re not big on reading the entire articles to abstracts at least give you an idea of what was being asked and then what the results were. And then, if you have access to a .edu email or, obviously the libraries in a particular university you can do it through there. And then if not, your local library, lot of times we’ll have those databases available for you so you can go to those publishers and get that particular article. So, it’s a bit of a process, it’s a bit of an undertaking, but if you’re really are passionate about the thing that you’re looking to make an argument for, it’s a worthwhile process.
HOST: Thank you. The next question is from Samantha, Steve, and by the way, if you want to, you can leave that up there or you can pull back your last slide so people have your email address in case people have questions afterwards. But I’ll leave that to you and then, oh, there we go. The next question, as I said, it’s from Samantha who says, When you need to raise donations for adult education or educating life skills, employment skills, what would be the best way to ask?
So I guess, you know, pulling from some of the data that you’ve read about and seen and also your personal experience, what are some of the things that are motivating factors for donors to those areas of work?
GRIMES: For adult education?
HOST: Yes. Adult education and life skills and employment skills. Yes.
GRIMES: And we’re asking here, what is the best way to ask, donors towards funding those initiatives?
GRIMES: This is a good question. Obviously, that constituency is going to be very different than probably many other types of constituencies. It’s very niche. I don’t know if I can answer that properly. I think I would go ahead and give an answer to say, what is your organization best prepared to do? Right. You don’t want to start researching what’s that fundraising environment for adult education and then just get a whole bunch of information that kind of a clouds the waters in terms of like the best things for you to do. I think probably the best way that you maybe want to go about that—and again, I’m so sorry I don’t have it for a specific answer for that constituency, but I think the best way to go about that is to think about what your organization is prepared to do when it comes to that.
Is it through an email campaign or you’re doing one on one solicitations? What marketing and camping are you looking to do? Is it through events, right? And whatever that thing that you’re prepared to actually go ahead and do to bring in those solicitations—You want to then research that and then figure out the best way to go about bringing in those donations.
So, whether that might mean an advertising campaign, and if you want to go ahead and have a tinge of guilt within that advertising campaign. You know, what is that going to look? Going back to slapping googly eyes on everything. Let’s say you wanted to do that—what does THAT look like? If I’m doing any type of research on the thing that I’m prepared to make an action on. I would strongly suggest that you fully grasp the types of actions that you’re willing to do first ,and then research fact in comparison to your constituency. I think if you’re going into the process of just researching what the landscape of your constituency, you will get lost in the noise of the conversations that academics have back and forth when it comes down to this sort of information.
HOST: Thank you. Steve. We have a question from Ashley who says, I’ve heard another speaker say that motivation is stronger when we are closer to the finish line. Do you have any comments on this?
GRIMES: Motivation of the donor is stronger or motivation …when you’re close to the finish line. [hmm…]? You know, I think really, when it comes down to being in front of a donor, making solicitations, making your case that your organization is worth being invested into–At that point, you’ve done everything that you need to do to go ahead and motivate that donor. I definitely don’t want to make it seem as if having this tool set of having journal articles give you all of this information and you’ve set things up and then all of a sudden that then means that the owner is going to give you money or you’re going to just come into this windfall. As fundraisers, we know that doesn’t really work that way.
GRIMES: Ultimately what you really want to do is put your organization and yourself in the best position possible to net as many donations or many donors as possible from those insights.
I will agree that, once you’ve made your case, that motivation is stronger. The truth of it is, is that you can make a strong of a case and the motivation is there. But, at the end of the day, the donor still has to close the deal. I didn’t include it here, but there’s some great research that talks about what those last steps look like once you’ve gotten in front of someone. Once you’ve made your case, once you’ve made it important to them, what do you do at that point is super nuanced and you can really get into a rabbit hole with that. I would strongly suggest you do the research and see what if at all you can do once you’ve made your case.
HOST: Janna asks, In prepping for this Webinar, did any research, surprise you?
GRIMES: I was surprised by the matching gift one where it says that if you had a larger ratio it actually did nothing for a donor. And I still actually can’t wrap my head around why it is, if you saw that your $1 would then equal $2, why that doesn’t give as much of an impact as the 1:1 [ratio]. Going through the methods that study, they were really in debt with their, with their quantitative methodology, and they got published by pretty significant publishers. They did their homework and, I guess from an anecdotal perspective, I still can’t wrap my head around why it is a donor would jump more to the 1:1 versus the 1:2. But you know, I guess that’s one of the beauties of research. It gives you a counter intuitive way of thinking sometimes and allows you to take pause to go: Huh, okay, I wonder what’s happening here. Um, as to why that’s happening and whether or not can be replicated or not replicated in my scenario. But the 1:1 matching one is still throwing me for a loop and maybe one of these days I’ll get around to reading the counter arguments to that.
HOST: It’s so funny, Steve, when you talk about that, because I was taking notes as you discuss the matching gifts and wondering about how our behavior might also then influence what they do next because YOU talked a lot about how the study referenced this idea of pain or cost. So if I get it, I can match a dollar. I feel great because I was given $2 on. I wonder what happens next as some organizations essentially thank people for $2 and others just thank them for a dollar. Do you have any thoughts on that? Just your own experience?
GRIMES: There were actually a bunch of studies I was going to add in and then just cut it down for time. There were a couple of studies that have really strong evidence that—and maybe this is a little bit tangential to your question, but I felt it was really interesting nonetheless—was that, when someone gives and they give more in response to an initiative or in response to an ask, when you’re thanking them, you don’t want to thank them in a way that shows that their gift was like a transaction. You want to thank them for their charitable-ness. You don’t want to thank them necessarily for what they gave. You don’t want to thank them in a transactional way because when you’re trying to cultivate that donor to believe in the cause, to believe in institution, to invest in an an institution, you want GRIMES: to avoid, as much as possible, any type of language or any type of way of thanking them that sees their gift as a transactional thing. I thought that was super cool, but I just, I couldn’t fit it in with this particular presentation. I know that’s not necessarily] answering your question, but I thought it was interesting to bring that up.
HOST: Right. It’s an important question. Maybe a great segue to another session on the DEmotivators because you talked about that earlier. You can’t put it all in 45 minutes this week, especially when the Internet gods are not cooperating. But, but that’s really important. It goes to the heart of donors to be good partners in motivating them and not, not, not depressing them by not thanking them appropriately, not encouraging their best behavior. Um, so maybe that’s a good way to end for today and hopefully we can have you come back when you’re willing and talk about the other side of this equation about the demotivating factors. Um, but we appreciate so much your introducing this literature to us so that we can actually take our fundraising activity and make it an informed activities based on real data, real science, and make sure we’re treating our donors in a way that helps them to be the best versions of themselves. Thank you so much Steve.
GRIMES: Jay. Thanks for having me. DonorSearch, thanks for having me, I really appreciate it
HOST: I want to thank everybody for being here and again, apologies for the technical difficulties, but you can see why we wanted to stick through to the end and why, when he has time, we’d love to have Steve Back to show us another piece to this puzzle so you can look forward to an invitation to that as you can for other sessions in this series. And I want to call attention to those who are remaining with us, that tomorrow’s session with Amanda Jarmin, on gender inclusive data management will have to be rescheduled, unfortunately.
So please be on the lookout for an announcement about that. However, the Thursday session at 3:00 PM with Tim, San Antonio of Neon One, who’s returning to discuss Automation: The Donor’s Journey Do’s And Don’ts, which in fact may dovetail quite well with some of the things that Steve has been discussing with us today. That will be held on Thursday as scheduled at 3:00 PM Eastern. So we hope you’ll return for that session. Thanks to DonorSearch for providing this platform to bring in people like Steve and these other presenters to speak with us about the things that are so important to our work and to that of our philanthropies. Thanks once again to Hannah Krobock, who definitely had her work cut out for it today in addition to entire series. This is Jay Frost speaking. We’ll look forward to seeing you Thursday. Take care.