Coin Small Gifts Donation Drains

A pre-giving incentive (PGI) such as a coin or a small pack of greeting cards is included in about 40% of direct mail charity solicitations, report researchers at University of Kansas and John Carroll University. How effective are such PGIs for increasing the frequency and amount of donations? the researchers went on to ask. The inquiries consisted of field studies in which actual solicitations were mailed out and laboratory studies in which the researchers could observe participants’ behavior. 

     The results of these studies indicate greeting cards, address labels, or stickers might attract donations, but a small-denomination coin actually decreases the yield from the campaign. The researchers illustrate their interpretation of the findings with a question: “(I)magine a situation in which the person you have a burgeoning romantic relationship with gives you a $20 bill before asking you to attend a family function with them…. But what if, rather than cash, your partner gives you a gift like a bottle of wine or heartfelt greeting card?”
     Their point is that we think of charities as friends to the community. Address labels for our letters, a calendar for scheduling our meetings, or cards we can use to share our sentiments all support these communal norms. That’s true even if we prefer digital to handwritten and postal communications these days.
     That’s not to say these non-monetary gifts increased the net yield of the campaign compared to including no PGI. They didn’t, in large part because the gift costs money and response rates to charity solicitations are so small overall.
     Worse though is that a coin signals an impersonal exchange relationship. Compared to the study condition in which no PGI or a non-monetary PGI was visible through a clear window on the envelope, when a quarter was shown, recipients were more likely to open the envelope. We’re uncomfortable considering cash as trash. But the actual donation amounts were lowest with the monetary PGI. Most of those who did respond simply mailed back a quarter, doubtless the same one they’d been sent.
     A monetary PGI might be suitable for bringing attention to a new charity and its appeal. In the laboratory studies, those who opened the envelope did often read the solicitation letter. Non-monetary PGIs could serve as reminders of the charity and of the value of community each time they’re used, if they’re used. But simply making your case sans gift seems best.

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