Document Type

Discussion Paper

Publication Date

6-1-2019

CFDP Number

2183R

CFDP Revision Date

9-24-2021

CFDP Pages

47

Journal of Economic Literature (JEL) Code(s)

L31, M31, M37, C93

Abstract

Charities routinely send “thank you letters” and small gifts to express gratitude to donors but seek to defray these costs by making additional asks for donations and/or engagement. But the “ask for more” can backfire if potential donors perceive persuasive intent in the expression of gratitude, inducing reactance. We hypothesize that such reactance and its impact on giving will vary by donor loyalty. Loyal donors are more likely to experience reactance to additional asks, muting the feeling of reciprocity aroused by the expression of gratitude to suppress giving. In contrast, non-loyal donors are less likely to experience reactance, and therefore more likely to channel the feeling of reciprocity toward giving. We test our hypothesis using a large-scale natural field experiment involving nearly 180,000 past donors to a leading charity in India. We find evidence in support of our hypothesis. We therefore recommend that additional asks only be made to nonloyal donors. Such differentially targeted ask messages based on past donation behavior, using data readily available to charities, can increase overall donation amounts by 12.8-17.5%. Our findings highlight that purely cross-sectional experiments that do not account for past donor/customer history may offer incomplete insight and lead to erroneous managerial implications.

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