When it comes to charitable giving, what makes someone decide to support a given organisation? David Faro explored the ways in which people make decisions about charitable donations and how organisations seeking funds can enhance their chances of appealing to potential donors.
Upon my return from a recent trip, I went through the mail that had arrived in my absence. Many envelopes contained appeals for donations from political parties or religious organisations. Most came from individual charities. These appeals often featured images of those in desperate need; for example, beautiful children with wide eyes and sad faces dressed in rags standing outside shacks — or even adorable animal cubs hovering close to their mothers. The stories attached to the appeals were also focussed on individuals (even when the charity was in reality supporting a larger group).
The problem for this donor was determining which of the many organisations asking for help deserved support. Doing some online research about charities, the numbers proved staggering. In the UK, there are over 180,000 registered charities that employ an estimated 20,000 people as professional fundraisers and many tens of thousands more who volunteer to ask others to donate money. In the US, over a million non-profit organisations compete for funds.
Loosening the purse strings
David Faro, Professor of Marketing at London Business School, along with Robert W. Smith and Katherine A. Burson (from the Ross School of Business at the University of Michigan), have been examining the differences in the amount of donations depending on the nature of the appeal. It turns out that there are some strong reasons why so many solicitations focus so heavily on individuals; it’s tied to the fact that donations to large numbers of victims are typically modest relative to donations to a single identified victim.
Their study, ‘More for the Many: The Influence of Entitativity on Charitable Giving’, which will appear in the February 2013 Journal of Consumer Research, shows that people tend to donate more to large numbers of victims if these victims are perceived as comprising a single, coherent unit — the term entitative is used to connote this. For example, donations to help children in need are higher when they are shown as part of a family than when they have no explicit group membership. The authors note that the same effect is observed when it comes to donations for endangered animals that are depicted moving in unison, as part of a group.
Moreover, the professors point out that perceived membership in a group (such as a family) results in donors judging them in special ways. Those in need with positive traits are viewed more favourably and trigger greater feelings of concern (and therefore higher donations), while such membership has the opposite effect for those in need who share what are perceived as negative traits.
The latter is clearly true even for large groups to which donations typically are not made on an individual basis. The authors point out that “only $25 million in donations were made to causes supporting Pakistan by Americans five weeks after the 2010 flooding compared to the $900 million in the five weeks following the 2004 Asian Tsunami.” However, even when it comes to appeals in the wake of large tragedies, individuals still do better than groups. In one research study, one group of participants read an appeal to help the millions of needy children in Africa. Another group saw a picture of a girl named Rokia and read only about her. Participants donated more to the single identified girl than to the group of needy children.
The role of entitativity
One of the causes of this kind of decision-making by donors, according to Faro and his fellow researchers, is that a large number of victims can trigger a more deliberative processing style, which can actually reduce sympathy. Another important factor is sensitivity to proportions. People tend to donate more generously as the reference group to which victims belong grows smaller and, thus, the proportion helped by the donor’s generosity thus increases.
You won’t find ‘entitativity’ in any standard dictionary, but the professors demonstrate that it’s an important concept to understand for those seeking donations. Entitativity, they explain, is “the degree to which a collection of individuals comprises a single coherent entity”. To explore the importance of this phenomenon, they ran a number of experiments to determine the effect on donations when donors perceive a collection of individuals as possessing unity and coherence. Their studies are the first to manipulate this effect, while holding constant other factors (such as the number of victims and whether they are identified).
The authors conducted four experiments involving students who were paid a fixed amount, for example £10, for their participation. The students were shown various appeals for donations and then asked how much of their participation compensation they would be willing to donate to help the victims they were shown.
Each of the experiments manipulated aspects of the group needing support. For example, one experiment focussed on presenting six children in need of aid as members of a family in one setting and as unrelated individuals in another. In another case, a negative trait was attributed to some of those in need: participants were asked to judge appeals to help poor children in Africa versus appeals to help children in Africa who were in prison for committing crimes.
The professors found that, in each case that included a negative factor, the donation level was lower even though the help that would be given and the demonstrated need were similar. The results were the same across the board, using the amount that the participants were prepared to donate as the determining factor. The unified groups of victims without negative characteristics received roughly twice the donations as the others.
From charities to businesses
Faro and his colleagues point out that this approach to charitable giving has already invaded the world of advertising, and they suggest that research is needed to determine if what is true in the world of giving is true in other areas. They note that “companies, brands, product lines, groups of employees, political parties, and mutual funds are just a few examples of targets that can be seen as a single entity or as a loose collection of parts.” For example, companies can refer to their product line as a family of products, equating it to an intimacy group. They also can unify the perception of themselves by dressing their service employees in uniforms or ending a commercial with a shot of all the employees waving or reciting the company slogan together. The question to explore is whether customers behave as donors do when a company portrays itself as a single, coherent unit in order to be favourably viewed.