Charities need to be careful when they nudge potential donors about a pressing need. Fundraising gains were muted over the long term because many would-be donors clicked “unsubscribe” when they received a follow-up fundraising email, according to a recent study.
During a fundraising campaign for DanChurchAid, a Danish charity, two Scandinavian economics researchers tested email reminders on a total of about 17,000 previous donors.
Half received only one email: a message stating that if they gave within 10 days, the charity would receive a matching gift. The others were sent the same email plus a reminder a week later.
The giving rate for those who received the nudge was significantly higher than those who received just one email. However, the reminder resulted in a much higher unsubscribe rate. The researchers found that when future donations are factored in, over the course of donors’ lifetimes the nudge reduced the total gains made by the solicitation by one-third.
“You want to be cautious that you’re not annoying people so much they stop paying attention,” said Mette Damgaard, the study’s co-author.
Can charities use other messages to nudge would-be donors without leaving money on the table? In a second test, instead of promising a matching gift, the researchers promised a reduced number of solicitations. In this scenario, fewer donors unsubscribed. But that doesn’t mean donors will always warm to pitches that promise fewer follow-ups, Ms. Damgaard warns. More research is needed on the types of inducements and the frequency of solicitation that work for different types of charities, she says.— Alex Daniels
The study, “The Hidden Costs of Nudging: Experimental Evidence From Reminders in Fundraising,” is a working paper by Mette Trier Damgaard of Aarhus University and Christina Gravert of the University of Gothenburg.
