April 24, 2014
Giving Donors Data on a Charity’s Impact Doesn’t Always Lead to More Gifts
By Cassie Moore
Providing data on a charity’s impact doesn’t necessarily translate into more gifts from prior donors, says a new report.
The report details an experiment in which Freedom From Hunger, a California charity, sent direct-mail appeals to its supporters. All of the fundraising appeals included a narrative story about how its programs benefited an individual. Some appeals also included scientific data on the impact of the charity’s work.
Donors who had given $100 or more in the past were more likely to give again when they encountered the data on the charity’s impact. But donors who had given less than $100 were actually less likely to donate when the appeal included the data.
However, they averaged out so that the total number of gifts to the organization did not change.
The paper was written by Dean Karlan, a Yale economist and founder of Innovations for Poverty Action, a nonprofit that tests anti-poverty programs in the developing world, and Daniel Wood, an economist at Clemson University.
They theorize that donors who gave $100 or more were motivated by “altruism giving” and were inclined to give more money to fewer charities. Those who gave smaller amounts were motivated by the “warm glow” of giving, triggered by emotional stories but not data.
“What this highlights to us is when someone is giving $10, $20 to a charity, this is not a very intense deliberative process,” says Mr. Karlan. “This doesn’t mean that there’s no recognition that they care about effectiveness, but it does mean that too much wonky talk might turn them off.”
Mr. Karlan says he plans to try to find the best ways for charities to communicate their impact.
“No one consciously would say, 'I don’t care about the impact of my money,’” he says. “So the question is, how do you get donors that information in the easiest possible way so that they can act on it?”
Giving Donors Data on a Charity’s Impact Doesn’t Always Lead to More Gifts
By Cassie Moore
Providing data on a charity’s impact doesn’t necessarily translate into more gifts from prior donors, says a new report.
The report details an experiment in which Freedom From Hunger, a California charity, sent direct-mail appeals to its supporters. All of the fundraising appeals included a narrative story about how its programs benefited an individual. Some appeals also included scientific data on the impact of the charity’s work.
Donors who had given $100 or more in the past were more likely to give again when they encountered the data on the charity’s impact. But donors who had given less than $100 were actually less likely to donate when the appeal included the data.
However, they averaged out so that the total number of gifts to the organization did not change.
The paper was written by Dean Karlan, a Yale economist and founder of Innovations for Poverty Action, a nonprofit that tests anti-poverty programs in the developing world, and Daniel Wood, an economist at Clemson University.
They theorize that donors who gave $100 or more were motivated by “altruism giving” and were inclined to give more money to fewer charities. Those who gave smaller amounts were motivated by the “warm glow” of giving, triggered by emotional stories but not data.
“What this highlights to us is when someone is giving $10, $20 to a charity, this is not a very intense deliberative process,” says Mr. Karlan. “This doesn’t mean that there’s no recognition that they care about effectiveness, but it does mean that too much wonky talk might turn them off.”
Mr. Karlan says he plans to try to find the best ways for charities to communicate their impact.
“No one consciously would say, 'I don’t care about the impact of my money,’” he says. “So the question is, how do you get donors that information in the easiest possible way so that they can act on it?”
