Transcript Unraveling the Mystery of Why People Give!

Melissa Morriss-Olson, Ph.D.
Many of us approach fundraising with a tin-cup mentality!
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When you hear the word philanthropist, what
images or words come to mind?
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How would you complete this sentence?
People I know who give are…..
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How would you complete this sentence?
As a giver, I am…..
Fundraising Lessons from Miss N.
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All people (and organizations) who exert
themselves for the well-being of others; who
engage in practical and heartfelt benevolence;
who donate money and time to causes they
believe in so that the world may become a
better place.”
◦ There is no “one size fits all” definition of a
philanthropist
◦ Philanthropic impulse is innate and plays out
differently over time and within specific
cultural context—every engagement with a
donor is unique.
◦ Fundraising process is more art than science.
◦ It’s all about people!
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The survival and health of most nonprofits
and service organizations depends upon
finding enough givers (individual and other)
who can be motivated and influenced to give,
who are capable of giving the requisite funds,
and who can be interested in the purposes
and needs to be served.
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Total giving across the country was up last
year by 4.0 percent to $298.42 billion,
according to Giving USA 2012.
Individuals and families account for 88
percent of all charitable giving, when you
combine their gifts and bequests.
Corporations account for 5 percent.
32% to religious causes
 13% to education
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Getting your share of the pool starts with
understanding why people do and don’t give
to particular causes.
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Stimulus to give influenced by both internal
needs and desires as well as external influences.
Key questions for fundraisers: “What can I do to
satisfy or enhance these factors within donor
prospects? How can these motivations and
influences be used to activate volunteers and
staff?
--Principles of Professional Fundraising,
Joseph Mixer (1993)
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Internal Motivations
◦ Personal or “I” Factors:
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Acceptance of self or self-esteem
Achievement
Cognitive interest
Growth
Guilt reduction
Meaning or purpose in life
Personal gain or benefit
Spirituality
Immorality
Survival
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Internal Motivations
◦ Social or “We” Factors:
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Status
Affiliation
Group Endeavor
Interdependence
Altruism
Family and Progeny
Power
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Internal Motivations
◦ Negative or “They” Factors:
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Frustration
Unknown Situations
Insecurity
Fear and Anxiety
Complexity
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External Influences
◦ Rewards:
 Recognition
 Personal
 Social
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External Influences
◦ Stimulations:
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Human Needs
Personal Request
Vision
Private Initiative
Efficiency and Effectiveness
Tax Deductions
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External Influences
◦ Situations:
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Personal Involvement
Planning and Decision Making
Peer Pressure
Networks
Family Involvement
Culture
Tradition
Role Identity
Disposable Income
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Determining Why People Do Not Give
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Personal Characteristics and Situation Problems
Communication Problems
Reactions to Solicitations
Organizational Image and Shadow Problems
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Why People Don’t Give
◦ Personal Characteristics and Situation Problems:
 Personal preferences
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Higher Priorities*
Not Concerned
Not Interested*
Not Involved
Stinginess
*most common
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Why People Don’t Give
◦ Personal Characteristics and Situation Problems:
 Contrary Beliefs
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Disagree with Mission
Don’t Agree on Policies*
Don’t Believe in Cause*
Don’t Like Programs
Different Work Ethic
*most common
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Why People Don’t Give
◦ Personal Characteristics and Situation Problems:
 Finances
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Can’t Afford to give*
Fear of Reciprocity
Economic Conditions
Tax Rates
*most common
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Why People Don’t Give
◦ Personal Characteristics and Situation Problems:
 Situations
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Complexity of Life
Competition
Changing Environment
Outside Local Area
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Why People Don’t Give
◦ Communication Problems:
 Lack of Information
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Mission Not Known
Organization Not Known
Others Not Supporting
Need Not Shown*
No Record of Service
No Real Case
No Results Seen*
*most common
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Why People Don’t Give
◦ Communication Problems:
 Ineffective Communication
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Negative Publicity
Publications Too Slick
Unclear Need
Promotion Too Costly
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Why People Don’t Give
◦ Reactions to Solicitations:
 Manner of Asking
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Asked Too Often*
Asked Wrong Way*
Asked for Too Little
Manipulation
Too Many Mailings or Contacts*
*most common
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Why People Don’t Give
◦ Reactions to Solicitations:
 Solicitor
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Don’t Like or Connect with Asker*
No Obligation to Asker
Used Paid Solicitors
Wrong Person Asking*
*most common
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Why People Don’t Give
◦ Reactions to Solicitations:
 Relationship with Prospect
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No Personal Contact
No Recognition
Not Appreciated
Not Asked*
No Tradition to Give
*most common
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Why People Don’t Give
◦ Reactions to Solicitations:
 Timing
 Already Gave
 Asked Too Late or Too Early
 Wrong Time
*most common
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Why People Don’t Give
◦ Organizational Image or Shadow Problems:
 Perceptions of Poor Organizational Behavior
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Active Mistrust
High Administrative Costs
Agency Too Rich
Bad Experience
Poor Reputation
Services Cost Too Much
Duplication of Services
Government Involvement
Taxes Pay for Services
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Why People Don’t Give
◦ Organizational Image or Shadow Problems:
 Management
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Misuse of Gifts
Poor Policies and Rules
High Fundraising Costs
Poor or Ineffective Management
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“Philanthropy is a social relation of giving and
getting between donors and recipients in
which donors have needs to be fulfilled as
well as resources to grant, and recipients
have resources to give as well as needs to be
met.”
-"Giving and Getting: Philanthropy as Social Relation,”
S. Ostrander and P.G. Schervish, in Critical Issues in
American Philanthropy, ed. Jon Van Til, Jossey Bass, 1990
Need
Agency
Resources: dollars and time
Prospect
Satisfactions
Psychological and social: Selfesteem, achievement
Purpose, status
Group endeavor, power
Source: Pacific Bell
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Why do people give to your organization?
What are your donors getting back in
exchange for their involvement with you,
for their commitment of time, talent and
treasure?
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Multi-generational family philanthropists give
differently than first-generation
philanthropists.
Religious motivations for giving can be
hugely important for some donors.
Culture, age, and gender can play a
significant role in determining if, how, and
why someone might give to a particular
cause.
More often than not, donor involvement
trumps nearly all other explanatory factors.
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Opinions diverge on how and to whom
women give:
◦ Women want emotional ties to the charities they
support
◦ Many women cite a charity's mission and efficiency
as key factors in their giving decisions
◦ Women demand to be involved in the institutions
they support
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There is nearly universal agreement on one
point: women play an increasingly significant
role in philanthropy
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Philanthropic landscape in transition
Recent economic downturn has jarred
confidence of many nonprofits and service
organizations
Donor confidence at all-time low
And yet, people continue to give!
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Recent Large Gifts by Source of Wealth:
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Media (6)
Investments (5)
Finance (5)
Retail (5)
Energy/oil (5)
Software/technology (4)
Financial services (3)
Healthcare/;medical devices (3)
Industrial/manufacturing (3)
Real estate (3)
Inheritance (3)
Hedge fund (2)
Horse racing (1)
Hotels/casinos (1)
Parking lots (1)
Legal (1)
Source: Chronicle of Philanthropy (gifts reported since October, 2008)
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Top 10 Recession Proof Businesses:
◦ Non-cyclical businesses (funeral homes, public utilities,
energy)
◦ Health care
◦ Information technology
◦ Discount retail
◦ Vices
◦ Education
◦ The government
◦ Repossessions and bankruptcy law
◦ Luxury retail
◦ Candy, Cosmetics and Contraceptives
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Corporate giving is most immediately
affected in economic downturn: corporate
foundations are funded with annual profits.
Foundation giving. Tougher to get new
foundation grants during economic downturn.
Family foundations have greater resiliency and
flexibility.
Individual giving has greatest resiliency and
donors do respond in difficult times.
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In a difficult financial climate, donors do
respond to new approaches:
◦ A Jupiter Research survey showed 2/3rds
of online donors plan to increase giving
online
◦ Online fundraising continues to grow,
attracting newer, younger donors and
increasing gifts through other channels
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In a difficult financial climate, donors do
respond to persuasive causes:
◦ Program support to meet a need that is highly
compelling
◦ Building projects that are dependent on financing
◦ Shovel-ready projects that are good for economic
recovery
◦ Availability of challenge and matching gifts
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Tremendous Wealth and Competition for
Resources
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Technology has revolutionized the
philanthropic process and context
◦ 24/7 expectations
◦ Access to new donors in far away places
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Corporate and Foundation Philanthropy
 Multi-year grants are out
 Single-year grants are in—with tighter restrictions,
evaluation requirements
 Less allowance for renewal or non-project
operation support
 More emphasis on pilot projects with emphasis on
replicability and scalability
 Global shift in giving emphases
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New Giving Vehicles:
 Giving Circles
 Professional Philanthropic Advisors
 Donor Advised Funds
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Today’s Donor
 Sophisticated and Savvy
 Less likely to give us the benefit of the doubt
 Motivations are more complex and needs are
greater
 Giving While Living
 Social entrepreneurs and investors
 Fundraising is not about the money; it is about
relationships
 People give because we MEET needs; not because
we HAVE needs
 A gift to your organization is really a gift through
your organization into the community
 All donors are really donor-investors
 Your cause and your case for giving is the same—
in good times and in bad
 Communicate
Connected
 Get Close
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Stay
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Tell stories
Communicate promise and impact—not panic
Let donors know you're using their dollars
wisely
Publicize new gifts and good news
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Answer the 4Ws:
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Why me?
Why now?
What for?
Who says?
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Make the case for giving
◦ Remind them of the consequences of
not meeting your mission
◦ Who will suffer, go without, be worse
off than they are today?
Top Reasons People Give:
•Because they were asked
•To give back to community
•Compassion for those in need
•Personally believe in cause
•Affected by cause
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Show the impact of your work on the
life of an individual
Show the impact of your work
on the community
Find a way to connect donors with
mission in up close and personal way
People who really care about your work
and mission will try to find a way to
help
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Significantly increase activity:
◦ Visits and briefings with donors and friends
◦ Communication
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Don't stop asking!
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Conduct a constituency circles audit:
Who has a reason to
care and to be
involved with you?
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Conduct a constituency circles audit:
Who are your collaborators?
Area College Education Programs
Parents
Teachers
PTOs
Who are your collaborators?
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Are you making the most of your website
presence?
 Get Online Now!
 Does your website pass these 2 key tests?
 Task Testing
 Passion Builder Testing
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Add an RSS Feed or social bookmarking
widget to your website:
Subscribe to our RSS Feed
http://beth.typepad.com/
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Pick one or two social networks where
your constituencies hang out:
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YouTube Nonprofit Program
http://www.youtube.com/watch?v=YpKAt
k5C0lM
 Invite your donors into the kitchen
 Inform, communicate and
demonstrate
 Steward the gift AND the donor
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What is one thing that your
organization can do this week to
increase its fundraising effectiveness?
Closing Thought
Many persons have a wrong idea of what constitutes true happiness. It is not
attained through self-gratification but through fidelity to a worthy purpose.
-- Helen Keller