By Jason McLure
Published Aug 08, 2013
Marketing professor Eesha Sharma shows how charities can win donations without focusing on a single beneficiary.
Child Fund International’s television commercials are hard to ignore. In one, actor Alan Sader sits on a bench outside a mud hut next to a thin girl, who looks wearily at the camera. “This little girl is Ellen,” says Sader. “She tells me that her tummy aches from constant hunger. And tonight like many nights, she’ll go to bed hungry again. Ellen is praying for a sponsor like you, just pick up the phone.”
The emotional impact of such commercials is undeniable. Researchers have shown that people tend to give more to charities when their donations benefit a specific individual, rather than a class of beneficiaries—like all malnourished children in Central America, for example. Yet this phenomenon is problematic. Funneling donations to specific individuals isn’t always feasible or efficient—particularly when beneficiaries are in remote areas or charities are focused on issues like research or preventative aid.
New research by Eesha Sharma, an assistant professor of business administration at Tuck, and Vicki Morwitz at New York University’s Stern School of Business, examines this issue. In particular, the researchers sought to uncover situations when people might give as generously to multiple recipients as to an individual like Ellen.
“There is diminished sensitivity to the value of life when the number of potential beneficiaries is larger,” says Sharma. “People are more sympathetic to a single individual and that sympathy decreases when it’s multiple beneficiaries—whether it’s millions or just two.”
In general, research has shown that many donors give to charity primarily because they form an emotional connection to the intended beneficiary. Since much research already shows that people will form a tighter emotional bond when donating to an individual (rather than a group), Sharma and Morwitz decided to focus on changing donors’ perceptions of the efficacy of giving to multiple recipients.
To do this they recruited individuals to participate in a series of laboratory experiments. In one of the experiments, participants were told that by giving money to UNICEF, their donations would be used to give either one child or multiple children the first vaccine out of a series of six—and that each vaccine significantly improved the health of the recipients. A second set of participants was given the same message but told that the first vaccine would only improve the health of its recipients if the other shots were administered.
What Sharma and Morwitz found was that participants showed increased emotional concern and generosity towards multiple beneficiaries in the scenario where participants were told their money would be more efficacious. Moreover, participants’ concern was heightened to such a degree that their generosity to the multiple beneficiaries surpassed their generosity towards the single beneficiaries. Interestingly, donations to the single beneficiaries were actually lower when participants were given the more effective immunization scenario than the less effective one. The authors speculate that this finding may be because when people feel their donations will be more consequential, they will want to distribute it more widely.
In another experiment, the two researchers sought to determine if the generosity of donors to either single or multiple beneficiaries could be increased by helping the donors to feel like they generally make a positive impact in the world. First, participants were given an exercise in which they were asked to write about a task important to them that they either had or had not completed effectively in the past. They were then given a charitable donation scenario and asked to give to either one child or a group of eight children.
The results showed that when the subjects had been asked to recall and write about something they had failed, they were more likely to donate to a single child than the group of eight. But when they were asked to write about something they had done successfully, they chose to give to the group of children rather than the individual by a nearly two to one margin.
Much evidence suggests that it is not easy to increase giving to groups of people because giving is driven by emotional concern, which is muted for multiple beneficiaries. However, Sharma and Morwitz suggest that enhancing perceived efficacy might be one tool organizations can use to increase both emotional concern and giving to multiple beneficiaries. The findings could help charities that are unable to focus donors on single beneficiaries to raise money more effectively. “By boosting the perceived impact of a charitable organization, a pro-social initiative, or a given donor, appeals that focus on multiple beneficiaries can be more effective,” says Sharma.
Eesha Sharma and Vicki Morwitz, “Saving the Masses: The Impact of Perceived Efficacy on Charitable Giving to Single vs. Multiple Beneficiaries,” is under review at the journal Organizational Behavior and Human Decision Processes.
Interesting research.The world would be a better place only if the gap between the riches and the poor closes down.It’s a tragedy that some people are enjoying all the amenities in life, while some have to go to their bed hungry.
By gajendra kc on 2013 08 27
Nice research. Just wanted to couple of new dimensions which might put some interesting perspective into use.
1. Trust factor in an individual versus an organization also plays a significant role. Trust in the allocation and usage of one’s donation in an organization is often lower than charity targeted towards an individual.
2. Human thinking of - I can’t transform the nation but I can transform an individual is very relevant in most perspective.
Rather than representing an organization with multiple beneficiaries, if it is represented as a targeted group of individuals, then my take is that it would draw more people to engage in charity.
By Sulabh Jhamb on 2013 10 20