One of the key issues in non-profit or religious media is donor development. Fergus Scarfe, head of that area for the God TV Network in Europe, sent this New York Times report on donor incentives highlighting recent research which suggests that seed money is a better investment for charities than matching gifts. The research found that match offers had a material impact on influencing donors to give.
In an experiment, 2.8% of people who received a match offer made a donation, compared with only 1.8% in a control group – an increase of 20%. However, the size of the match had no effect. A separate experiment looked at the effect of ‘seed money’ on donor behavior. Seed money refers to when charities raise a large portion of their target amount before officially launching a campaign.
The researchers found that the more upfront money the charity claimed to have on hand, the more additional money it raised. And when compared with the matching gift research, “the study suggests that seed money is a better investment for charities than generous matches”.
I would agree, from the perspective that donors want to know they’re not giving to a lost cause. There are many cases where an attitude of desperation in the ask gave the audience the heebie-jeebies (that’s a technical term) and as a result, the donors jumped ship. I believe people want to get behind a winning cause, and from that perspective, pleading poverty might actually hurt you. Read the article – I warn you, it’s heavy stuff – and let me know your thoughts…