239. Charities and Nonprofits: Does Behavioral Science Work the Same? with Luke Freeman

The Brainy Business | Understanding the Psychology of Why People Buy | Behavioral Economics

The Brainy Business | Understanding the Psychology of Why People Buy | Behavioral Economics

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6M ago 46:45

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In today's conversation, I am joined by Luke Freeman, who is the executive director of Giving What We Can, an organization dedicated to creating a culture where people are inspired to give to the world’s most effective charities. Giving What We Can was one of the first organizations in the world focused on effective altruism: the project of using evidence and reason to figure out how to best help others, and taking action on that basis.

I specifically asked Luke to be on the show today to discuss behavioral science concepts and how they line up with nonprofits. Sometimes, concepts perform exactly as they would in a traditional customer/company relationship when there is money being exchanged…but in other cases, research has found this isn't the case. When people are volunteering or donating some tactics that would show you are grateful or appreciative of a customer (like giving a gift) may backfire and feel…off.

Knowing this is a time of year when people who work in nonprofits or volunteer on boards are gearing up for year-end asks or doing strategic planning for next year and people may be thinking of their annual donations, it seemed like the perfect time for this episode to help everyone be more effective with their support of others now and into the future.

Show Notes:

[00:45] In today's conversation, I am joined by Luke Freeman, who is the executive director of Giving What We Can.
[03:08] Luke shares his background and the work that he does. His background is in marketing and he has recently moved to the nonprofit sector.
[05:14] When Giving What We Can was looking for an executive director, it was a perfect opportunity to do work that was really important to him.
[06:18] Typically, when people are giving to charity they are giving to something right in front of them or things that they have had some experience with.
[07:39] When people think about charity effectiveness generally the two things that they think of are overheads or administrative costs and impact.
[09:48] The first bar is trying to get people to look outside of themselves and try to improve the lives of others. Once you are there then you narrow in on where you can make the most impact.
[12:27] We can take time to think about what we care about, whose life/lives we are looking to impact, and what is going to be the best use of money to help.
[13:16] We often look at neglectivness because popular problems are often getting a lot of resources already. A lot of stuff is neglected because it fits in the prevention space.
[14:44] People are often willing to give right away out of pity or guilt, but that isn’t sustainable giving.
[16:32] Sometimes behavioral science concepts that work in traditional buying relationships don’t necessarily go the same way when looking at nonprofits and charities.
[18:45] Donors want to feel confident in their donations. Showing other humans giving and why they give is also quite motivating.
[22:29] If your company gets the right story it can really work for the company in terms of their own sales as well. People prefer that there be a logical story that is told of why that charity makes sense for the company they are partnering with.
[24:55] With any brand messaging when you can be specific and narrow the story down or follow the story of someone it has a bigger impact.
[27:33] Donation matching is also popular but there isn’t a lot of strong evidence of its effect.
[28:52] Recurring donations make more sense for many donors and are much more sustainable.
[30:30] The door in the face technique and artificial surveillance cues don’t tend to be as effective with donations. Explanation about context from Melina and why this might be happening – don’t generalize results!
[33:25] Recognizing volunteer contributions and having a more human connection can be very helpful for keeping and increasing volunteers. Volunteering strategies are going to be very specific to the organization's context.
[35:00] Some volunteer opportunities are also donor nurturing programs in disguise (in a good way). It showcases the work that the charity does and even if they cost more to run, they are worth it because they create new donors.
[37:51] Don’t give people reasons not to do the thing you want them to do. Also, after the fact appreciate it.
[39:10] If you do nothing else this month, what does Luke recommend? You really need to get in the head of your user and in this case that is a donor. Your existing donor base is the biggest asset you have.
[40:15] People really care that they are able to help others and they want their money to go as far as possible. A game of “hot or not” with Luke’s rapid-fire tips.
[43:41] Melina shares her closing thoughts.
[43:51] I love the idea of being more thoughtful before supporting the most popular organization you might see or hear about the most.

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Get the Books Mentioned on (or related to) this Episode:

The Speed of Trust, by Stephen M.R. Covey
Influence, by Robert Cialdini
Predictably Irrational, by Dan Ariely
You Have More Influence Than You Think, by Vanessa Bohns
How Minds Change, by David McRaney

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