Inflation Messaging
Giving USA reported charitable giving increased by 1.9% but after adjusting for inflation, it’s down 2.1%. The cost side of your P&L has likely gone up, whether charity or agency.
Is this a macro, negative externality you’re stuck dealing with or might this be a time to raise “prices”?
If you raise your ask amount and explain it and it’s perceived to be fair, it increases satisfaction. So, what influences fairness judgements?
- If it’s because of increased costs then it’s perceived as more fair.
- If those costs are externally imposed then its tilts further into the fairness camp.
- And if the organization is perceived as a good actor/benevolent, even more fair.
This is a trifecta of perceived fairness that will be showered on a nonprofit’s explanation for why it’s asking for more. We ran a test for a food bank client that changed the tick box messaging from asking to cover the 3% transaction fees to instead cover the 13% increase in food costs along with a bit more rationale.
The test (Variant B) won, increasing conversion by 9% and getting more people to select to cover 13% (vs. the 3% transaction fees) so higher average gift too. Rationale matters as it determines perceived fairness.
Kevin
4 responses to “Inflation Messaging”
Behavioral Science Q & A
Integrating an individual giving appeal with other communications from a charity can have both positive and negative effects, and the outcome largely depends on how it’s executed. Advantages of Integration Brand Consistency: Maintaining a consistent appearance and messaging across all communications can reinforce the org’s brand identity and strengthen brand recognition and trust among your […]
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I’m not aware of any in-market tests specifically comparing recurring vs. gift frequency language. I suspect the answer might not be the same with all gift frequencies, nor with all people. It sounds like a great opportunity for you to test and find out what works for your audience. Based on the literature, here’s a couple […]
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Based on what we know from existing data, those renewal notices can actually be pretty effective in getting people to donate. They tap into our psychology – creating a sense of urgency, reminding us of past support, and using personalization to make the message hit home. They’re playing on our natural tendencies to feel obligated […]
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Interesting question. I had a quick look at the testing done on this topic. On the positive side, in all cases, over half of donors decide to cover the fee. In some cases, it goes as high as 65%. Not a negligible percentage at all. Here’s another test from iRaiser showing consistent results (see point […]
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There’s just one thing to consider when designing a supporter journey: the supporter. More specifically, you need to take into account: Who the supporter is i.e. their identity, which is the reason they support this cause, and their personality, which describes the way they “see” and process the world. These will determine the kind of […]
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I’m not an expert in this but a quick search surfaced this article on the effect of tax reforms on 2019’s charitable giving. The researchers didn’t find a reduction. Actually, they observed an “increase in charitable contributions in 2019, even with the lower tax rates and the dramatically smaller number of taxpayers who itemize their […]
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Perfect timing with this post, Kevin, thank you for the (data-grounded) insights!
You’re welcome Lisa, glad they were helpful
Super useful! I never really liked asking folks to cover “transaction fees” (even though it may work). I like the idea of asking people to cover something that actually brings satisfaction. While both are honest approaches, this one FEELS more authentic and less like nickel-and-diming.
Glad it helps Claire and yeah, nobody likes to feel unappreciated.