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Guide to Encouraging Generous Giving

27 MAY Education

Encouraging generous behaviour can be a crucial factor in ensuring charities continue to operate and deliver positive outcomes. Numerous psychological and economic studies are published each year attempting to uncover effective methods of encouraging generosity, with varying degrees of success.

The Research

A study published by Costello and Malkoc (2022) revealed a method that more than doubled the generosity of participants. The study explored the relationship between generosity and involvement. Over seven related studies using approximately 2700 participants they compared volunteering versus donating. The authors proposed that donors are more likely to give their time rather than their money because of the personal control it offers. Personal control can be described as the level in which an individual believes they are able to influence their environment. It was indicated that this element of personal control can increase both interest in donating and donation amount.

The authors identified a trend when a donor’s sense of control was threatened, they were more likely to offer their time as a compensatory strategy for regaining control of their donation. The study counteracted this phenomenon using subtle language interventions which increased perceived control, thereby leading to an increase in donation amount. These interventions were simply the difference between using the words ‘give’ and ‘spend’. The request to ‘give’ was associated with a relinquishment of control over a donation and how it would be used by the charity; whereas to ‘spend’ one’s money implied an element of control over the direction and purpose it would have, rather than total disconnection from the gift. Participants approached for a donation offered more than twice the amount when asked to “spend” their money ($94) on a cause than when they were asked to “give” their money ($40).

Similar analyses by Cryder, Loewenstein and Scheines (2013) found providing tangible details about a charity’s operations can significantly increase donations. The authors hypothesised that when someone donates to a general cause, they may feel like they are making a tiny dent in a large problem. However, when someone donates to a detailed cause, they may be more convinced that they are having a clear impact on a specific issue. This hypothesis is likely related to the donor control phenomenon presented by Costello and Malkoc (2022).

Cryder et al. (2013) expand on the differences of a detailed cause rather than a statistical cause. Statistical causes, only provide general information about all group members, such as the region they are from, or their common difficulty. In contrast, a detailed cause of an individual includes their name, what they look like, and their specific plight. Cryder et al. (2013) reference the work of Kogut and Ritov (2005a, 2005b) who found that participants given information about a child in need of medical treatment were willing to donate around 60% more on average where the child was identified by age, name, and picture, as compared to a child described without these features.

What can my charity do to encourage generosity?

To conclude, these studies illustrate that a key component to generosity from donors comes in the nuance of how a charity solicits donations. There is profound potential that continues to be discovered and refined through research to prompt donation behaviour. Keeping donors in the loop from beginning to end about how their donation is used and whom it will reach has been demonstrated in the above contexts to drastically increase the generosity of donors.

Towards the future of Australian charities,

Guide

Further Reading

  • King Street Associates have collated a number of scientific articles that attempt to address the motivations behind generosity and how it can be promoted.

References

Costello, J.P. and Malkoc, S.A. (2022). Why Are Donors More Generous with Time Than Money? The Role of Perceived Control over Donations on Charitable Giving, Journal of Consumer Research. https://doi.org/10.1093/jcr/ucac011

Cryder, C.E., Loewenstein, G., & Scheines, R. (2013). The donor is in the details. Organizational Behavior and Human Decision Processes, 120(1), 15-23. https://doi.org/10.1016/j.obhdp.2012.08.002

Kogut, T., & Ritov, I. (2005a). The ‘‘identified victim’’ effect: An individual group or just a single individual. Journal of Behavioral Decision Making, 18(3), 157–167.
https://doi.org/10.1002/bdm.492

Kogut, T., & Ritov, I. (2005b). The singularity effect of identified victims in separate and joint evaluation. Organizational Behavior and Human Decision Processes, 97(2), 106–116. https://doi.org/10.1016/j.obhdp.2005.02.003

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Integrity, honesty and unbiased assessment are at the core of Giving Guide’s mission. The charity sector is important to the economy and culture of Australia, We believe independently assessing the accountability, transparency and effectiveness of the sector beyond what is currently available is important to it's future.

Giving Guide anticipates enhancing the level of governance and transparency in the Australian charity sector. An independent charity advisor would benefit the sector by helping charities consider exceeding the existing governance standards of the Australian Charities and Not-for-profits Commission (ACNC) to the benefit of donors.

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