The Donor Upgrade Conundrum

July 8, 2019      Kevin Schulman, Founder, DonorVoice and DVCanvass

Every day on her way to work, a woman walks by the same bagel stand run by a guy who is clearly selling these bagels to survive.  So every day, that woman drops a dollar in the mug and leaves without asking for a bagel.

One day, she feels a tug on her sleeve as she’s leaving – it’s the man who runs the stand.  She says “I suppose you are wondering why I leave a dollar every day without taking a bagel?”

He replies “No, I just wanted to tell you bagels are now two dollars.”

 

So many of our donor upgrade strategies amount to this: asking that same person for a different amount or in a different way.  Circle the middle value.  Put some social proof to it.  Localize that social proof.  Reverse the ask string order, knowing that the first value has the most pull.  And, of course, et cetera.

As the author of our Science of Ask String white paper, I’m a fan of testing all these tactics.  It’s great when you can increase donations for no additional cost.

But donors largely lock in their giving if they make their second gift at the same amount.  De Bruyn and Prokopec looked at this phenomenon in their 2013 paper on ask strings.  They found the best value to anchor your ask string to for first-time donors was anything but their previous donation – higher and you increase average gift; lower and you increase response rate.  But the best value to anchor your ask string for repeat donors is what they’d given before.

These donors have set a value for the organization to which they are giving, just as the woman in the story at the beginning had set her value on zero bagels.

We will sometimes bemoan this: despite all our cleverness, why are donors not upgrading to our organization?  And at a macrolevel, why is nonprofit giving at two percent, plus or minus, of US GDP since we started keeping track.

The fault, dear Brutus, is not in our donors but in ourselves.

There is a reason no marketing campaign has ever been successful with the slogan “Same product!  Twice as expensive!”  Call it Newton’s First Law of Upgrading: A donor’s giving amount at rest will tend to remain at rest unless acted on by an outside force.

Thankfully, dear reader, you are an outside force.  Collectively, we are a force.

Our force must be aimed at increasing the value our donors get from our organizations.  We want them to give more and think it a bargain.  How do we do this beyond the pale simulations of additional value that are premiums and matching gift campaigns?

One is to focus on the individual’s impact, rather than the collective one.  As Dr. Kiki Koutmeridou has said in our Ask a Behavioral Scientist section:

“Major donors are more interested in the difference they will personally make, rather than the usual “together we can…” pitch. Charities should emphasize their personal impact and adapt the language and offers accordingly to increase conversion.

To invert this somewhat, people are more inclined to make major gifts (whatever that means for them) if they have a personal impact.

Another is to increase the value of that impact to the donor by making it more personal.  As we preach with identity, donors choose and stay with the nonprofits who can address not who the charity is, but who the donor is as it relates to the cause.  If I know you are a disease sufferer or cat person or a mountains person or were treated at our hospital or knew hunger once or someone whose family member has an intellectual disability or… or… or… and I can tailor the reason to give to that identity and the things you want to support, my charity is going to be more valuable to you.

In short, learning about donors and acting on that knowledge can make you more valuable to them.

We can also be a resource to our donors, giving them ever more value.  We’ve talked about an information exchange – giving to get – as a way of acquiring new constituents to our organizations.  But it does not stop there.  If you are continuing to deliver value along that constituent’s life with you, they will increase their giving.  Reciprocity scales.

In these ways, we can be the force that changes our donors’ behaviors not just once but permanently.  Here, as everywhere else, you get out what you put in.

Nick

2 responses to “The Donor Upgrade Conundrum”

  1. Craig Cline says:

    Loved the joke — made me laugh out loud!

  2. Denn says:

    Spare Change News, the paper produced and sold by homeless people in the Boston area, recently did just that: raised the price from $1 to $2. My reactions? 1) It’s about time. 2) I’ve got to start carrying more singles in my wallet.