What behavioral science can teach charities about fundraising: 7 tips
Following agency Reflect Digital’s recent report into online fundraising for charities, Kiran Webster breaks down 7 ways that behavioral insights can maximize donations.
How can behavioral science level up charities' donation strategies? / Katt Yukawa via Unsplash
The digital landscape has opened opportunities for charities to reach a wider audience and collect online donations. Online donations have increased by 78% since 2017, making it an opportune time for charities to expand their reach.
However, fundraising in today's challenging environment requires charities to not only increase the number of donors but also maximize the average donation amount. By leveraging behavioral science and understanding human behavior, charities can overcome barriers and enhance their fundraising efforts. Based on research findings, these seven tips use behavioral science to help them do that.
1. Understand the action-intention gap
Many charities assume that lack of awareness or insufficient information about their cause is the primary reason people don't donate. However, research shows that the action-intention gap is a significant factor.
This refers to the situation where individuals have the intention to donate but fail to follow through. To bridge this gap, charities need to address unconscious barriers and cognitive biases that influence decision-making.
2. Overcome present bias
‘Present bias’ is the tendency to prioritize immediate rewards over future rewards, leading to procrastination. Research suggests that employing the ‘give more tomorrow’ technique can be effective in online giving. Instead of asking for an immediate increase in a donation amount, charities can ask donors to commit to increasing their monthly donation at a future date.
This approach reduces the psychological discomfort of parting with more money by moving the decision to the future. Give-as-you-earn schemes can be exceptionally effective at overcoming present bias by encouraging people to donate straight from their gross salary via payroll. Our research here at Reflect Digital found that 45% of people are not aware of payroll giving, and only 13% were already signed up for one.
This approach not only addresses present bias but also helps counter loss aversion, where the pain of donating is perceived as greater than the satisfaction of giving. Partnering with businesses and promoting give-as-you-earn options can provide a reliable and consistent source of donations.
3. Leverage social norms
Social norms play a crucial role in influencing behavior. By highlighting the donation behaviors of others in marketing campaigns, charities can leverage social norms to motivate potential donors. Our research shows that 20% of people do not trust charities. Incorporating social norm messaging across channels can build trust, increase awareness of payroll giving, and encourage action.
4. Ensure relevance and resonance
To increase donations, charities must communicate messages that are relevant and that resonate with potential donors. Research indicates that our cognitive biases struggle to comprehend large numbers or abstract statistics. Translating statistics into relatable terms can make the impact more tangible and the motivation to donate more urgent.
For example, instead of stating that "1.5 million people are in need," charities can say, "1.5 million people, equivalent to the entire population of Kent, are in need."
5. Make it easy
Friction costs. Even seemingly small barriers can significantly impact donation completion rates. Charities should prioritize user experience and simplify the donation process. Our research shows that only 52% of respondents understood what UK tax relief scheme Gift Aid was, while 10% had no idea and 28% thought it would affect their tax allowances.
By educating potential donors about (for example) Gift Aid and simplifying the process, charities can remove friction costs and maximi\e contributions.
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6. Target wisely
One-size-fits-all approaches are no longer effective in today’s diverse landscape. Charities should tailor their communications and campaigns to specific audience segments. For example, research shows that 18-34-year-olds are more likely to express a desire to give more to charity than other age groups. By targeting digital campaigns towards this age group, charities can tap into their willingness to donate and tailor messages that resonate with their values and aspirations.
7. Test and learn
Testing is essential for campaign success. While research provides valuable techniques, testing helps charities make data-driven decisions specific to their audience and circumstances. A/B testing, such as using different email campaigns or creating varied landing pages, can provide insights into what works best for each charity. By implementing these strategies, charities can optimize their fundraising efforts to increase donations and the reach of their message.
You can read Reflect’s full report on how charities can leverage behavioral science to increase donations here.
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Reflect Digital Limited
Putting our client’s customers first, we work closely with ambitious global brands and eCommerce businesses looking to elevate their marketing and move towards true customer centricity. We help these companies to unleash their digital performance and grow revenue by leveraging human insights and psychological nudges to optimise strategies.
We believe end-customers do not care what channel they find their solution(s) via. The key for brands is to deliver the right message at the right time in the right place, having built enough of a relationship and trust with the user to drive action or conversion. This is why a deeper understanding of your customer’s journeys, drivers and motivations is needed if you want to deliver exponential growth.
Since we were founded in 2011, we’ve received many awards and recognitions, including Employer of the Year, and Best Integrated Campaign 2022 with Nido Student, among others demonstrating both our commitment to our team and delivering truly strategic campaigns for our clients.