‘Donor fatigue” is strangling charity fundraising campaigns. Creative ideas, based on game theory, have helped dozens of organizations increase their donation income — by as much as 2,000%, according to Arnon Shafir, CEO of Tel Aviv-based Give2gether.
Game theory is the study of decision-making among multiple interacting parties in a group or system, such as governments, markets or organizations.
“Game theory gives us a great insight into why people do what they do,” said Shafir. “We’ve applied the theory to fundraising, and we’ve found that when donors have a stake in what happens to the cause they are donating to, they’re more likely to give more money, and to encourage others to do so as well.
“Our case studies show that organizations using our methods are able to increase donations by tens of percent, and, in some cases, thousands of percent.”
For example, one of those creative ideas could include limiting the amount of money a donor can give to a cause, Shafir explained. According to research by Give2gether — and proven, Shafir said, by numerous case studies — capping a donation at a certain amount paradoxically increases the overall pool of money raised. When individual donations are limited, more donors feel they have a stake in the success of the project, because their money is necessary — and they’re more likely to urge others to get involved as well.
“Every dollar does not necessarily count,” added Shafir. “What’s more important, and more beneficial for nonprofits, is widening the circle of donors. In the end, organizations will raise more money when the crowd is bigger, and everyone feels they have a stake in its success.”
Give2gether, which aims to help nonprofits get their message across, has lots of ideas to get more donors to provide organizations with more assistance. The CEO continued:
“We advise organizations to use nonintuitive methods to appeal to donors, based on extensive research our team has done on what makes people give to causes. Much of our methodology is based on game theory, as applied to social network-based fundraising campaigns.”
The system is somewhat similar to the crowdfunding techniques used by sites like Kickstarter, but the 10,000 hours of research that have gone into Give2gether’s methods, said Shafir, “makes us like Kickstarter on steroids.”
Limiting donation amounts is just one of the effective, if nonintuitive, methods Shafir uses for Give2gether clients to bring in more donations. Using Give2gether, clients set up their own online funding campaign — Give2gether earns its money by charging clients a monthly fee — with the system automatically suggesting methods and strategies, depending on the nature of the campaign, its target audience, the amount of money being sought, etc.
The strategies, according to Shafir, are designed to inspire social activism among organization members and sympathizers, giving them a stake in the results of a campaign.
Thus, the system might suggest to an organization guarantee that, if a fundraising goal is not met within the allotted time, all the donations will be returned to the donor. Under those circumstances, according to the research by Give2gether, people are more likely to give money: They are assured that their contribution will be used only for the target purpose — or not at all. According to Shafir, studies carried out at UC Berkeley show that conducting such “conditional” campaigns increases donations by individuals by 300%.
Organizations also get better results when they break down their funding requirements into tangible, achievable projects. Even the largest budget can be cut down into chunks of $25,000, $50,000 or $100,000 — the ideal amounts for a Give2gether campaign, Shafir explained. “People want to feel that their contributions are both meaningful to the completion of the campaign, and significant. And the more tangible the campaign, the more they will feel that way.”
Of course, there’s no need to rule out the “traditional” methods of fundraising, said Shafir. Celebrity endorsement, news releases, peer pressure, and simply asking people for help are all essential elements of a campaign. But for maximum effectiveness, those methods must be paired with the ones advocated by Give2gether.
“Especially in today’s competitive nonprofit environment, organizations need to respond to donors’ concerns. We’re not trying to trick anyone — just reach them with a message that accurately reflects what the organization they support and care about really needs. When presented with that kind of message, people are willing to go the extra mile and help out.”
The Give2gether website is chock-full of testimonials and case studies of successful and satisfied clients. Some examples are the Philadelphia school that was able to raise $15,000, in a single week, to send a team to a robotics championship in St. Louis; and the Canadian SPCA group, which increased its donations by over 2,000% within two years, and increased the number of people donating by over 1,000%.
“Crowdfunding has become a very hot area in recent years, and a lot of small start-ups were able to raise the money to develop their projects at sites like Kickstarter,” Shafir continued. “There’s no reason crowdfunding won’t work for nonprofits.
“Our methods, developed over many years of research, have successfully been used in business. In today’s economy, the nonprofit ‘business’ is just as tough as any other. And we are proud to have helped hundreds of organizations meet their fundraising goals.”