When Doing Good Is Bad (and Retail Is Better)
[Editor's note from Target Marketing: Retailers may be seeing returns right now, but nonprofits — not so much.]
There’s an old adage: “To a hammer, everything looks like a nail.”
Because I work for nonprofits, I figure everyone wants to participate in do-gooding. Predictably, I make contributions to charity on behalf of the recipients for gifts. Call them socially responsible gifts. It makes me feel good to do that. I always presumed it made the recipient feel good, too.
A favorite of the Beloved (behavioral expert Otis Fulton) and mine is Heifer International. Last Christmas, we were excited to “give” a relative a sheep that was donated to a needy family in a Chinese village. A gift of diminishing hunger and poverty. Everyone is on board with that, right?
Yeeeeaaaahhh … No.
According to an article in the Organizational Behavior and Human Decision Processes, givers badly overestimate how much their recipients will appreciate a charitable donation that is made in their name. That squares with my experience. I was excited and expected to get a phone call the moment the gift was received. Instead, I got a cursory “oh yeah, that was nice” when I inquired about if the gift notice showed up.
In one study, gift-givers chose between six gifts to give to a friend or family member. Three were donations to various charities. The other three were run-of-the-mill items: a travel mug, executive-style ballpoint pen and a USB flash drive.
Ninety-eight of the 245 participants in the study (40 percent) chose to give a charitable donation.
Interestingly, the less close a gift-giver was to the intended gift receiver, the more likely they were to give a gift of a charitable contribution.
It turns out that an overwhelming majority of the recipients would have rather received even a “really mundane tangible gift” instead of the charitable donation.
The way the recipient viewed the charitable donation had a lot to do with their relationship to the giver. Close friends didn’t object, and parents reported actually liking receiving the charitable donation from their children. The problems were with spouses and distant friends and relatives who were the most likely to evaluate the charitable contribution negatively.
How can this be explained? Lisa Cavanaugh, one of the study’s authors, said, “Recipients think [the charitable contribution] says more about you than about your commitment to them. One spouse actually said, ‘It showed me he cared about the world but he didn’t care about me.’ ”
One part of the equation is that people may be recognizing a socially responsible gift as an attempt by the gift giver to make themselves look good, like giving a really nice picture of yourself to someone. Typically the person most interested in a really nice picture of yourself is your mom, right?
But we believe the more important reason that giving to a specific nonprofit in another person’s name is less than ideal is that it deprives that person of giving something themselves.
That is problematic for the recipient because I don’t give them control, and I don’t actually allow them to “give.”
First, the recipient didn’t pick the charity — the giver did. Satisfaction is derived from three basic elements: being part of something bigger, showing competence and autonomy. As the giver, I didn’t deliver any of those three here.
Second, there is a well-studied “warm glow” effect from giving. That warm glow isn’t triggered for the recipient in this scenario, although presumably it may be for the giver. The recipient did not get to be socially responsible — the giver did (and I felt GREAT about it!).
So what is there to do?
If I want to give a socially responsible gift, I must give it in a way that allows the recipient choice. As an example, I could use a card from Charity Choice (not a plug — don’t know ‘em), which allows the recipient to choose from hundreds of charities to designate the gift, making the gift from the recipient, instead of from you.
Another way to inspire the warm glow and be socially responsible would be for me to allow the recipient of the gift to select how they will support Heifer International. If I could send the gift with an open end on it, to allow my recipient to pick a cow, or a chicken or a well, that would give us both something positive — the satisfaction derived from giving driven by autonomy and the warm glow effect.
I’m sure you think the Beloved and I are quite calculated about giving, altruism and nonprofits. And we are, for two reasons. First, giving is tricky and we are prone to plan campaigns in ways that bring consequences contrary to our intention. Second, the warm glow of giving cures diseases, educates children, prevents violence and so much more. We like understanding how to light that fire.
Katrina VanHuss is the CEO of Turnkey, a U.S.-based strategy and execution firm for nonprofit fundraising campaigns. Katrina has been instilling passion in volunteer fundraisers since 1989 when she founded the company. Turnkey’s clients include most of the top thirty U.S. peer-to-peer campaigns — Susan G. Komen, the Cystic Fibrosis Foundation, the ALS Association, the Leukemia & Lymphoma Society, as well as some international organizations, like UNICEF.
Otis Fulton is a psychologist who joined Turnkey in 2013 as its consumer behavior expert. He works with clients to apply psychological principles to fundraising. He is a much-sought-after copywriter for nonprofit messaging. He has written campaigns for St. Jude’s Children’s Research Hospital, The March of Dimes, the USO and dozens of other organizations.
Now as a married couple, Katrina and Otis almost never stop talking about fundraising, volunteerism, and human decision-making – much to the chagrin of most dinner companions.
Katrina and Otis present regularly at clients’ national conferences, as well as at BBCon, NonProfit Pro P2P, Peer to Peer Forum, and others. They write a weekly column for NonProfit PRO and are the co-authors of the 2017 book, "Dollar Dash: The Behavioral Economics of Peer-to-Peer Fundraising." They live in Richmond, Virginia, USA.