Skip to main content

Variable Donation Amounts in Cause Marketing, A Hypothetical

Today’s post is a brief thought experiment or hypothetical. What would happen if the donation amount in cause marketing was variable? How would that affect participation and results for the company and the cause?

For instance, suppose that you buy a Sole insole or ‘footbed.’ Sole was the topic of Wednesday’s post. One of the causes Sole sponsors is the shoe charity Soles4Souls. Soles4Souls is always looking for gently-used shoes. So let’s suppose that when you buy a Sole footbed that Sole donates $1. But if you buy a Sole footbed plus donate a pair of shoes then Sole donates, perhaps, $3. Would that increase in-kind donations for Soles4Souls? Would it increase sales for Sole?

You can probably imagine other variable donation scenarios as well involving Tweets or Facebook ‘likes’ or repins on Pinterest.

What I’m talking about is frequently used by experimental economists in laboratory settings. In experimental economics you’re given a number of choices to make using real money and given certain rules and circumstances. The tests are designed according to standard game theory.

The ‘dictator game’ is frequently used to test altruism in people, for instance. I cited an example last year whereby someone started with $10 and for every dollar they gave up and anonymous partner would get $5. In such cases altruism could be said to be ‘cheap.’ If, however, your anonymous partner got just $0.20 for every dollar you gave up, altruism would be very expensive.

What would you want to offer variable donation amounts? To encourage certain behavior, of course: to make altruism cheap.

And cheap altruism is a worthy goal, certainly in public policy settings. It's why some countries allow donations to nonprofits to be tax deductible.

What do you think? Respond below in the comments section.

Comments

Nice job, it’s a great post. The info is good to know!

Popular posts from this blog

Top Eight Cause-Related Marketing Campaigns of 2007

Yeah, You Read it Right. It's a Top 8 List.

More cause-related marketing campaigns are unveiled every day across the world than I review in a year at the cause-related marketing blog. And, frankly, I don’t see very many campaigns from outside North America. So I won’t pretend that my annual list of the top cause-related marketing campaigns is exhaustive.

But, like any other self-respecting blogger, I won’t let my superficial purview stop me from drawing my own tortured conclusions!

So… cue the drumroll (and the dismissive snickers)… without further ado, here is my list of the eight best cause-related marketing campaigns of 2007.

My list of the worst cause-related marketing campaigns of 2007 follows on Thursday.


Chilis and St. Jude Children’s Research Hospital
I was delighted by the scope of Chilis’ campaign for St. Jude Children’s Research Hospital. As you walked in you saw the servers adorned in black co-branded shirts. Other elements included message points on the Chilis beverage coas…

Cause-Related Marketing Meets Microfinance

Kiva.org and Advanta.com Mix it Up

You’d have had to have been in Ulaanbaatar, Mongolia the last year or so to have missed the run up of microfinance. Between 2004 and 2006 more than $4 billion of capital flowed into microfinance institutions. All told experts say the total loan microfinance loan portfolio may be as much as $12.5 billion. And of course the father of microfinance, Muhammad Yunus won the 2006 Nobel Peace Prize. Microfinance is now so respectable, so effective, (so profitable!) that it’s already enjoying its first global backlash.

Actually that first sentence is hyperbole. Because even in Ulaanbaatar… far from almost anywhere on the vast, frigid steppes of Mongolia… microfinance is thriving such that the earliest recipients of micro loans there are now complaining about taxes and government bureaucracy! And May 29-31, 2008 the Conference of Microfinance Institutions will convene in Ulaanbaatar, the eleventh such annual conference.
Now Advanta, a credit card issuer to small…

Cause Marketing Beer with BOGO, Brew One Give One

On Monday’s post I touched on the topic of telling people what your cause marketing campaign accomplished when completed. I’ve recommended this approach to clients as a way to keep open the lines of communication with customers and clients and to get extra value from the campaign.

In other words, you’ll want to hold back some of the promotion’s budget to continue to activate the effort until the very end.

But what if that really cuts across the grain in your organization? What if it’s just not in your corporate DNA to do anything but to frontload your cause marketing activation? Well, then, add the report back to the activation of your next cause marketing effort.

New Belgium Brewing of Ft. Collins, Colorado, said to be the seventh largest brewery in the United States, did just that with this ad in Sunset magazine. I found this ad in the Alden Keene Cause Marketing Database.

New Belgium donates $1 for every barrel it brews and sells. It’s a BOGO cause marketing effort, Buy One Give One. …