How the brain decides whether to donate

The classic of this decision-making writing is Daniel Kahneman’s Thinking, Fast and Slow.  In it, he talks about two thinking systems, cleverly named one and two.  System one is our fast thinking, emotional, instinctual system; system two is our contemplative, logical, slower system.  Many of the cognitive biases and heuristics that we talk about in this blog stem from system one having clever (and not-so-clever) shortcuts so that we don’t have to spend the energy to think.

There’s a subtle shift on this that more neurological minded decision theorists propose (not that Kahneman’s system is bad — there’s a reason it’s a classic).  They say there are three decision-making pathways: 

  1. Pavlovian: This is the system that makes you want a meringue cake dessert.

    300px-pavlova_dessert

    Nope, sorry.  Knew I shouldn’t be writing while watching Food Network.  A Pavlovian pathway is instinct: it’s an unconscious or nearly unconscious, reflexible behavior.  It gets its name from the ring-a-bell, get-a-treat, now-the-dog-salivates-when-the-bell-rings conditioned response guy.  This may be System 0 in the Kahneman taxonomy.

  2. Habitual: When you repeat actions over and over, they become subconscious behaviors.  There’s a neurological saying “fire together, wire together,” meaning that if you do something repeatedly, the stimuli involved in that something will tend to become associated and more efficient working together.  Think of walking the same path through grass day after day.  Pretty soon, that path becomes almost as good as a sidewalk, controlled by your basal ganglia.

  3. Goal-oriented: When you make conscious, reasoned decision based on trying to get to a positive outcome.  You likely have heard about how people like President Obama, Steve Jobs, and Mark Zuckerberg wear the same thing every day so they don’t have to make that decision every morning.  There is a germ of truth in this: we can only handle so much in a day and every goal-oriented decision takes its toll.

If you would like to read about these three mechanisms and how they function in prosocial (not selfish) behavior, there’s a nauseatingly detailed study here

So what are the implications for direct marketing?  I’d love to hear yours; here are a few of mine:

  • For a certain type of supporter, is reduced cognitive load part of the pitch for a monthly donation EFT?  That is, can you take something that you have to think about in the goal-oriented pathways and put it into automatic?
  • Conversely, do you want to?  Do you want to encourage goal-oriented thinking or aim for a more conditioned response?
  • Donors will likely expect that you behave like Pavlov’s dog.  That is, you need to do what you say you are going to do, especially as it relates to acknowledgments.  If someone is going to expect that hit of dopamine upon receiving their thank you, you need to follow through on that.
  • This likely explains the reason that gifts under $100 are given with the heart and over $100 are given with the head.  At that point, a gift goes from a habitual response to a goal-oriented action full of actual thoughts.
  • What type of conditioning are you doing with your direct marketing program?  There is a chance that premiums are conditioning some of your donors, whether habitually or Pavlovianly, to donate only when they get something for that donation.
  • Are there some means of communication that are truly Pavlovian?  I’m thinking here of mobile messaging.  When someone automatically checks their phone when they get a ding sounds, it’s not too many steps removed from a salivating dog listening to the bell.
  • See if you can discern habitual behaviors in your donors.  Do you have a set of donors who gives every year in November or December, but never in the other ten months out of the year (answer: yes, you do)?  Do you still mail them or call them with all of the other donors in June?

Any other thoughts?  I’d love to hear how you are building positive habits with your donors at nick@directtodonor.com or in the comments section.

How the brain decides whether to donate

Oxytocin and direct marketing: beyond the cuddle chemical

 

Oxytocin is a hormone produced in the hypothalamus, which is responsible for a number of major autonomic (or unconscious, like breathing) functions of the body.

Oxytocin is sometimes called the cuddle chemical or the hug hormone.  It’s a natural classification.  Oxytocin is released naturally as a part of childbirth and is associated with maternal behavior and social attachment.  

However, it goes much beyond this.  More recent research has shown it’s important in the formation of trust.  People dosed with oxytocin are more willing to trust their money with strangers.  Some researchers think this is because they are also more able to read facial expressions and emotional states.

On the dark side of oxytocin, while it promotes trust with in-group members, it also increases distrust of foreigners and outgroup members (study here)

More to the point of nonprofit direct marketing, when people empathize with a story, oxytocin levels are on average 47% higher. (study here)  (More so among women than men, which is perhaps why women are more likely to empathize and give charitably).

This translates to additional giving.  Subjects who received oxytocin gave to 57% more causes and 56% more money after exposure to PSAs (study).

But that’s nothing compared with what is possible.  In the same study, they looked at what happened when people experienced increases in both oxytocin and a fast-acting arousal hormone called adrenocorticotropic hormone (which people abbreviate ACTH for obvious reasons).  When the PSA increased both of these, giving increases 261%.

This means that the story has to both arouse empathy (releasing oxytocin) and draw the person in (stimulating ACTH).

So how do you do that with your narrative?

First thing is to take what your high school English teacher taught you about the five-act structure of plays, where you have rising action, leading to a climax, then a falling action that leads to a resolution.  Remember that?  (You may even remember the term Freytag’s pyramid, in which case, good job, Hermione.)

Now crumple it into a ball, throw it away, and try to forget it ever existed.  As we’ve said before, all pyramids are lies.  Even in the two-minute video that Zak used to test his subjects, attention tended to drift until tension raised again.  This is far less Freytag’s pyramid and far more the latest Avengers movie, where there has to be a tension set piece every so often to hold interest.

The goals are emotional resonance and attention holding.  When you have a narrative that does that, you release oxytocin and ACTH.  And when you do that, you get donations.

We’ve talked a lot about ways to do this, imagery and specific details being particular favorites.  However, when it boils down to it, take a look at your story.  If there are any paragraphs, sentences or words (especially adverbs!) that don’t help one identify with the people in the story or hold the attention of the reader/listener/watcher, cut it.

It’s brutal, but you need to hold attention and create empathy with it in order to succeed.

Tomorrow, we’ll get out of chemistry and into how people make decisions.  

Oxytocin and direct marketing: beyond the cuddle chemical

Doping in your direct marketing

lance_armstrong_tour_de_france_2009_-_stage_17

Not this kind of doping.

Our brains are miracles of electricity and chemistry.  Each electrical and chemical reaction is a way of communicating from one part to the other.  And there’s hardly a more fun chemical in the brain that dopamine.

Dopamine is what’s called a neurotransmitter.  It is released by nerve cells (neurons) to send messages to other nerve cells.  And it moves through special dopamine pathways.  One of these is called the mesolimbic pathway, aka the reward pathway.  There will not be a test on this.

Think of the classic rat-pushes-a-level-and-gets-a-reward-experiment.  That’s what dopamine does.  Do good.  Get a dopamine reward.  Most addictive drugs work through dopamine and most anti-addictive medicinal treatments repress dopamine.  In fact, there are case studies, including this very readable one from The Atlantic, of people who are addicted to giving because of their neural pathways.

Dopamine dulls pain, arouses, causes pleasure, and dilates the eyes.  I mention this last one so I can give you a good tip for reading people by way of Sherlock.

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Sherlock: because I took your pulse: elevated; your pupils: dilated. I imagine John Watson thinks love’s a mystery to me, but the chemistry is incredibly simple and very destructive.

As a result, it’s a pretty nice thing to have on your side in nonprofit direct marketing.  The “warm glow” of giving is largely a dopamine reward (mediated by oxytocin, which we’ll talk about tomorrow).  When researchers look at fMRI data, they found that when someone gives to charity, the nucleus accumbens (which is usually associated with unexpected rewards) lights up and produces dopamine.

So how do you build dopamine and how do you use it?

The first is obvious and we’ve talked about it ad nauseum: thank your donors well.  Part of why dopamine is addictive is that the brain tends to anticipate it.  And you don’t want to deny someone that hit of dopamine for their good deeds.  Conversely, an unexpected reward can have the same impact that unexpected flowers or a gift can have for a spouse or loved one.  No, not the wondering what you did wrong one — the good one.

Beyond that, it’s something you can stimulate in your copy and storytelling.

Seeing other people happy releases dopamine and makes the person who observes them happy.  While I’m on the record not to sugarcoat our issues, when you can show the after and the impact you are having, you can do so in a way that makes your donor happy as a result.

Affirmations.  On online buttons, you’ll notice a lot of conversion buttons are now starting with “Yes,” or its excitable cousin “Yes!”.  This is because a positive affirmation can release dopamine and excite the person seeing it.  We become the rat pushing the lever.

Exclusivity can also give a dopamine hit.  We’ve talked about its power in persuasion; dopamine is part of why.  Here there’s a double shot; once when you know things that no one else knows and once when you share it with them.

And finally, use lists.  Our brains love to complete things, thanks to the reward it gives itself every time.  Bullet points tend to work better than comma’ed lists with each one making a nice mental check every time it’s read.

So that’s dopamine in a nutshell (or a skull).  Please check back tomorrow to learn about oxytocin, or sign up for our newsletter and never miss a post!

Doping in your direct marketing

This is your brain on direct mail

Readers of a certain age (namely, around my own) will recognize the 80’s era PSA that taught a generation of Americans about proper egg cookery.

But the truth is that your brain is awash in drugs constantly.  They just happen to be of your body’s own making.

So this week, I want to take a look at how people’s brains receive our direct marketing communications and how it should influence our efforts.

Three caveats:

  1. I am not a brain scientist.
  2. Neuromarketing is still in its infancy.  It’s difficult to tell whether what is lighting up on an fMRI is a cause or an effect.  To a large extent, we are still black boxes, where we can observe what’s going in and coming out, but only guess at what happens in the middle.  There’s also a great deal of hucksterism in the community because of the newness.
  3. If #2 were wrong, I wouldn’t necessarily know it because of #1.

Now, if you are still with me, I’d like to talk about how the brain processes tangible marketing (e.g., mail) versus non-tangible marketing (e.g., online).

Temple University (at the request of the Postal Service Inspector General, so not the purest possible study) looked at how the brain processes mail versus online

They showed subjects a mix of 40 postcards and emails and monitored them through eye tracking (for visual attention), fingertip sensors for heart rate, breathing, sweating (for emotional engagement), and MRIs (for brain activity).  

Online efforts were distinctly better in one thing: focusing attention.  On the other hand, print won in terms of emotional interaction/arousal, engagement time, desirability for the things in the ads and recall.  The two means tied for memory recall and information processing.

Specifically, the researchers found greater activity in the hippocampus and areas around the hippocampus for physical ads than in digital ads.  The hippocampus is associated with memory formation and retrieval, meaning that participants could remember a greater context for their paper-based stimuli.

If you are a fan of Sherlock, as I am, or the book Hannibal (eh…) you know about the memory technique known as a mind palace — associating things you want to remember with physical locations.  Part of the reason this works is that tangible things are, well, more tangible and easier to retrieve out of memory.

As a result, a week later, subjects showed greater emotional memory for print.

This was replicated in a UK study and a Canadian studySpecifically, with print, more processing took place in the right retrosplenial cortex, which I had never heard of before this paper.  Apparently, this is involved in processing emotional cues and helping them get into memory.

So, in our first foray into brain science, we can say that while people may focus more on online images (in part because it is a more structured environment; life is rarely so structured outside of a computer screen), they forge greater bonds with mail.

The one caveat to this is that mail versus print ads misses the interactivity that is possible online.  It didn’t test video, or click-throughs, or quizzes: just static online ads.  So, just as we shouldn’t trumpet the death of direct mail, neither should we dismiss online as mere ephemera.  There’s more to learn here.

And we’ll do some of that tomorrow with the role of dopamine in nonprofit direct marketing.

This is your brain on direct mail

An ode to the mostly filled thermometer

When was the last time you saw an analog, mercury-based thermometer?  Chances are, it was in a fundraising campaign, indicating how close you were to goal.  Even as thermometers go digital, their ancestors are honored through skeuomorphism* to symbolize progress.

But we come here not to bury the fundraising thermometer, but to praise it.

Specifically, we want to praise how the fundraising thermometer, or a specific state of it, can make people more likely to donate.

fundraising-thermometer-template

Cryder, Loewenstein, and Seltman took a look at how the amount toward goal already raised impacts a person’s likelihood of giving here.

They call it the goal gradient hypothesis: they think that people will be more likely to donate the closer a campaign is to goal.

So they tested this with Kiva, the microlending site that you may remember from such hits as “does being more attractive increase your chances of getting funded on Kiva”?  (Yes, it does.)

They found that when an individual fundraising goal was 0-33% complete, the average hourly progress toward goal was 6.7%.  When it was 33-66% complete, progress was 10.8% per hour; for the final third, it was 12.8% per hour.

So, having the thermometer partial full helped increase fundraising efforts.  This would tend to make sense, since the thermometer is a measure of social proof, a potent persuader.  (It’s the same reason that servers will seed a tip jar with larger denomination bills — it helps set the pressure and the anchor)

Hey, I can hear you yawning.  Yes, I know you aren’t going to be going on Kiva tomorrow.  But we’re just warming up.  The researchers then worked with a nonprofit to mail lapsed donors.  They had three separate goals that they were trying to reach and mentioned that one was 10% complete, a second was 66% complete, and the third was 80% complete.  They also had control conditions where no progress was mentioned.

Sure enough, the 10% and 66% conditions were not significantly different from the no progress control.  However, the 85%-to-goal piece significantly increased response rate (from .5% in the control to 1.17% in the 85%-to-goal version).

They even tested the “why” of this with donor surveys.  They asked people if they would be more likely to buy candy bars from a 7th grade fundraiser if the fundraiser was two bars short of goal or 32 bars short.  Two-bars-left won handily.  Additionally, the donors who chose the two bars indicated they felt like they were having a bigger impact and were more satisfied with their donation.

So, since not everyone can be the donation that pushes you over the finish line, how can you use this?

One tactic is to have a silent period of a campaign.  For online year-end giving, I’ve worked with organizations that will set their goal and their thermometer based on what it will take to hit goal starting from November 1, but only announce the goal and the effort on Giving Tuesday.  That way, their thermometer is at least 20% full when the first donor hits the form.

Another is to ask internal audiences (especially board members) to make the first gifts.  Showing them this research may help them feel like their gift is making a difference by getting others to give more freely.

Finally, you can define down your goal.  The 85%-to-goal condition mentioned above was based on being 85% toward buying a GPS unit for an international relief organization.  This is not a high-ticket item.  By setting the goal low, they were able to talk about 85% complete easily.  This type of microcampaign, repeated writ large, can help illustrate impact for your donors.

So keep those thermometers more than half full and you should be on your way to filling it up the rest of the way.
* A design based on an older version of an item to help people understand the newfangled version.  It’s the reason that email programs look like folded envelopes and your video app probably features an old-school movie clapper.

Thanks to Tim Vandevall here for the thermometer image.


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An ode to the mostly filled thermometer

When does a match light a flame?

We’ve talked about how a lead donation can be as or more effective than a matching gift campaign and how using a lead donation can also calm the overhead related concerns of donors.  

From that, it may sound like I’m anti-match.

 

mission2bimpossible2bfuse2blighting2bmatch2btv

(insert Lalo Schifrin score here:
BUM BUM BABA
BUM BUM BABA
WAHNAHNAAAH WAHNAHNAAAH etc.)

But I’m not.  It’s a widely used tool that I’ve found to be effective in several cases and, unlike most tactics, the donors I talk to also seem to enjoy matching campaigns.

Some research can help shed some light on when to use a match and when not to.  Karlan, List, and Shafir published a study in the Journal of Public Economics (and who doesn’t pick that up for a little beach reading over the summer) looking at match rates.  

Normal studies tend to focus on whether the match works overall: yes it does or no it doesn’t.  This study, however, gives some guidance on when to deploy a match.  It also cross-deployed the match with a test of urgency, which is one of the building blocks of influence.

So there were four test conditions:

  • Matching gift with urgency (with a reply device and PS that said things like “NOW IS THE TIME TO JOIN THE FIGHT!”; you can tell it’s urgent because it’s in ALL CAPS!).
  • Matching gift without urgency
  • Control with urgency
  • Control without urgency

And they did a bunch of other stuff also that is not relevant for our purposes here, including testing different match sizes and timings and such.

The authors found that urgency actually hurt the appeal in many cases (probably, they hypothesize, because there was no particular reason given for the urgency; when it was combined with a match deadline, this negative effect disappeared).

As for the matching gift, there was evidence that it worked, but it only worked for donors who had made their previous gift in the past year.  These donors were 3.2% more likely to donate with a match in place and their average gift went up.  On the flip side, donors who had last given more than 12 months prior had their response rate drop when the match condition was in place.

I mentioned earlier that the donors with whom I spoke seemed to like the tactic and that seems to be supported by this study: active donors do like a match.  However, it seems to bump into trouble when the person has not donated reanecdotalcently.

There’s likely one exception to this (and this is based only on anecdotal evidence, so take this with an appropriate-sized amount of salt).

I have found that people who have given to a match before are more likely to give to a match again.  Thus, if you are suppressing out 13+ month donors from your match campaign, I’d counsel you to leave the ones who have shown the tactic has worked for them.

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When does a match light a flame?

Ask strings and $100: It’s all about the Benjamins, maybe

I, like many, am currently obsessed with Hamilton despite the minor handicap of not having seen it or likely being able to see it in the near future.  (Not shockingly, the idea of someone writing like they’re running out of time appeals to me.)  But the Founding Father most relevant to our work is still likely Ben Franklin.

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Do not reproduce.

In nonprofit work, we tend to view the $100 level as a bit magical.  Once someone makes the psychological jump to three figures, they are likely weighing the effectiveness of your nonprofit and not just the emotion.  Additionally, when someone is giving in the same number of digits, it’s easier to upgrade.  That is, the jump from $100 to $200 seems easier for donors to make than $50 to $100, even though it’s more money to increase.  And $100 donors in acquisition are instant candidates for high-touch treatment, as they are showing significant support of your organization from the start.

There’s a lesser known place where $100 is magic: in your ask string.

Reiley and Samek did a study in which they tried two different ask strings). The first was $35, $50, $75, $95, $250, and other.  The second was the same as the first, but with $100 swapped in for the $95.

Revenue per solicitation went up 29%.  Average gift went up almost 20% and response rate went up 7.6%.  Let me repeat that: the ask string with the higher gift amount in it also had a higher response rate.  This is a rare thing.

The major reason for this, they hypothesize (and I agree), is fluency.  As I wrote in the piece on word choice:

People tend to prefer things, people, objects, etc. that are easy for them to understand. (study here). This is known as the fluency bias. There’s a reason that only eight names cover more than half of our presidents (James, John, William, George, Thomas, Andrew, and Franklin (which used to be a lot more popular than it is now)). Names that are more common help people rise faster in occupations. Believe it or not, stocks that have ticker symbols that can be pronounced as words outperform stocks that can’t be.

So, you would think logically that $100 isn’t the only fluent number.  And you would be right.  Another study looked at whether people were more likely to give $20 or a strange amount like $20.03 (if they graduated from the college in question in 2003).  People were less likely to give the strange amount (although this was not statistically significant at the .05 level).

So remember to create round numbers in your ask strings unless you have a really good reason to: the ease of recognizing and using these amounts will benefit your organization and get you more of those elusive Benjamins.

When you can, see if you can get the $100 into your ask string.  It increases your response rate with no loss in average gifts.  Wins like that don’t come along every day.


 

I’m working on a book on ask strings.  My goal is to make it free to subscribers of my newsletter here.  So if a round-up of the science and psychology of donation amounts sounds interesting, please sign up today.

PPS. Tomorrow would also be fine, as I won’t be done with the book tomorrow, but that lacks urgency, don’t you think?

 

 

Ask strings and $100: It’s all about the Benjamins, maybe