A basic assumption of charity fundraising is that many people do not make large donations because of economic reasons but do not make small donations because they fear they will not be worthwhile.
To find a solution, researchers at Arizona State University carried out an experiment in which they solicited donations to the American Cancer Society by promising donors that “even a penny will help.” When compared to a control group, members of the subset given this assurance about the value of their donation were twice as likely to donate. In addition, the average donation size was equal in both groups, meaning that advocating for small gifts did not reduce generosity in givers.
A follow-up study published in the Journal of Consumer Research found that fundraisers could gross 20 times more donations than a control group when they told potential donors that minute donations would make a difference. The authors concluded that the “legitimization of paltry donations may prove to be an effective means of enhancing fundraising efforts,” as they can improve the frequency of donation without reducing the size of the average contribution.
This “foot-in-the-door” style of fundraising is similar to that used by door-to-door salesmen, who find that they have better luck if they physically enter someone’s home and thereby break the threshold between outside stranger and trusted agent. These studies show that our ultra-low asking price of one penny will break a threshold that has prevented many potential donors from giving, and once they begin contributing everyday they will increase their donations to match those made by others of similar socioeconomic status.
We call our approach “micro-giving,” a method of outreach and fundraising that utilizes proven financial psychology to attract new givers and make donating more enjoyable for current givers. The sum of thousands of small daily gifts will result in substantial income for charities that create positive change in the world.