The Power of the Nudge

Here at the end of January, nonprofits across the spectrum are analyzing the results of year-end giving campaigns, looking for the trends that will help set priorities and metrics for 2019. A recent online article on behavioral economics may provide a new perspective. In the online quarterly magazine, the Stanford Social Innovation Review, authors Dean Karlan, Piysh Tantia and Sarah Welch’s article Behavioral Economics and Donor Nudges: Impulse or Deliberation? explain the science behind behavioral economics for insight into whether people are giving or not giving to charity and how to “nudge” donors toward giving more. 

The authors describe how the science can “help facilitate donations, whether impulsive – quick gifts involving little analysis but rapid and positive emotional feedback – or deliberate – thoughtful contributions that resist the temptation of fast, feel-good donor experiences and more deeply account for the recipients of the aid and its results.”  Think donor interaction with text-message fundraising campaign versus a major gift donor understanding more deeply the mission and results of your organization. 

Karlan, Tantia, and Welch assert, “Some donors prefer to give impulsively and embrace strategies that encourage intuitive, quick actions that make them feel good. Other donors want to be more deliberate with their giving, and the right tools can help them follow through on those intentions. In both cases, rigorously testing new approaches and strategies can help charities learn what works best for them and the impact they have on the world.”

The authors go on to provide thoughtful examples of nudge techniques for both impulsive giving and deliberative giving with real-world examples and suggestions for how to use the techniques. 

Read the full article online.