Hello Indiana, I hope you're well and enjoying this course. Please let me know if you have any burning questions.
In this email, I want to talk about how we can use psychology to maximize the amount of donations people are willing to make. Understanding why people do what they do will make it much easier to plan effective strategies. It also avoids expensive and time-consuming trial and error.
But, before we do that, it's important to take a moment to discuss the ethical considerations around donation psychology.
Ethical Considerations
In my book "Click," I argue against using tricks to manipulate users. These tricks make them do things they later regret. This is ultimately bad for brands and long-term revenue.
But in the case of giving, things are slightly different. Data indicates that the vast majority of people want to give more to charity. But, many fail to do so because of deep-rooted psychological factors. Our goal is not to trick people with psychology. It is to help them give the amount they really want to give.
To do this, we need to understand the psychological aspects at play.
Understanding the Psychology in Action
There is a kind of battle that happens when people visit a donation page. It's a battle. On one side are a person's higher functions that want to donate. On the other are their more primitive instincts that seek to reduce the perceived cost or sacrifice.
The two biggest factors at play are.
Loss aversion - People feel the pain of losing money much more strongly than they do the pleasure of giving.
Perceived scarcity - People feel that they don't have as much money to spare than they really do. This leads individuals to be more hesitant to part with their money, even when they want to support a worthy cause.
Our primitive brain resists parting with our hard-earned money when we reach the moment of giving. It tries to convince us not to give, even if our higher reasoning says it's the right thing to do.
Our primate brain also lives in the moment and focuses on personal benefits. It struggles with concepts like the long-term impact of charitable donations and finds it hard to empathize with others.
Our higher functions will even try to justify these feelings from our primate brain by arguing that if we don't give, somebody else will. This is referred to as the Bystander effect.
All this is to point out that fundraisers must ensure they can overcome these psychological barriers. They must make giving as easy and rewarding as possible.
So how do we do that. Well, we can start by framing the act of giving in a way that doesn't trigger the primal instincts of loss aversion and perceived scarcity.
Framing Donations to Resonate with Donors' Mindsets
To achieve this objective we can frame the donation to:
Make the benefits feel more tangible.
Reduce the perceived cost.
So what does this look like in practice?
One way to make the benefits feel real is to attach a dollar amount to a specific impact. For example, "A $30 donation can provide a family with clean drinking water for a month." This helps the donor visualize the direct positive outcome of their contribution.
This feels like a "good deal" to our primitive mind because $30 is a low price to pay for clean drinking water.
At the same time, we can reduce the perceived cost by comparing it to something trivial such as a daily coffee or a meal out.
By highlighting the tangible impact of donations and framing the cost in a relatable way. We can tap into people's innate desire to help others. By doing so we overcome the psychological barriers that often prevent them from donating as much as they would like.
But, we don't want to stop there. We can also provide some personal, short-term benefits to win over the primitive brain.
Harnessing Psychological Rewards to Drive Generosity
Remember, the primitive brain, which lives in the moment, seeks rewards for its actions. We can do this by offering small tokens of appreciation or incentives to donors, like exclusive content, early access to events, or even a small gift.
Even something as simple as a thank-you note can go a long way in making donors feel appreciated and incentivized to continue their support. I have even used public recognition to reward generous donors. People feel pride and belonging when their contributions are acknowledged.
But we've got one last trick up our sleeve for overcoming the psychological barriers to donation.
Minimizing the Perceived Cost of Giving
If we can reduce the perceived cost of giving, we've made the benefits look a lot more attractive to the primitive brain. One way of doing this is to push users towards a small monthly gift instead of a one-off larger gift.
Because our primitive brain does not consider the future, it doesn't think about the longer costs of giving.
But we've got to keep that monthly gift small. Too often I see charities push for high monthly gifts that end up overwhelming donors and causing them to abandon the donation process. People are willing to give up a coffee a month. They're not willing to give up their Netflix subscription!
If you do want to encourage higher monthly giving, you could introduce a "give more tomorrow campaign."
This approach is inspired by Richard Thaler's "save more tomorrow" philosophy. It reduces the pain of saving by committing to automatically increase saving over time.
We don't ask people to give today. Doing so would wake the primitive brain. Instead, we encourage them to commit to increasing their monthly donation in the future. For example, when they next receive a pay rise. This feels less burdensome in the moment.
By adopting these psychological strategies, charities create a more enjoyable and rewarding experience. This helps overcome the innate biases of the human mind and enables donors to contribute what they genuinely wish to give.
But there is one major psychological factor that we've not discussed - social proof. Social proof is a powerful psychological force that can greatly influence charitable giving. That's going to be the topic of our next email.
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