Impulse Buying Vs. A Donor’s Gift
June 21, 2016 Geoffrey W. Peters
Have you visited a higher-end restaurant lately? Look at the difference between the menus of a regular restaurant and a higher-end restaurant the next time that you go.
“Hamburger . . . $4.95”
“Waygu Beef marinated with dashi broth on a fresh baked sourdough roll . . . 15”
Did you notice anything about the prices (other than that they are higher-end)? There is no currency symbol (e.g. $) at the higher-end menu. Why? Years of commercial “menu research” has yielded at least one clear result — placing a currency symbol before the price yields greater price resistance. (Yang et. al., “$ or Dollars”)
Let’s look at another commercial test. Consumers were asked to say the last two digits of their social security number out loud. They were then asked what price they would pay for a wireless computer keyboard. The results (Ariely, Predictably Irrational):
SSAN Avg. Price
How is it that a more or less random number, read out loud, could significantly affect one’s perception of the price (or value) of a widely available commodity?
The answers to both why restaurants are deleting the currency symbol and how totally unrelated information can influence perception of price or value come from the relatively new field of Neuromarketing or “behavioral marketing.” More and more fundraisers are learning to apply some of that research and thinking to fundraising.
Traditional psychology was based on simplistic theories of stimulus and response. In direct response fundraising, everything is measured and fundraisers know what works but often not why it works. Previous measurement technologies were:
* Focus Groups and Survey Research — What are you planning to do?
* Focus Groups and Survey Research — What did you do?
* Direct Response Results — What happened?
* Direct Response Testing — Which won?
The problem with focus groups is that consumers dissemble about what they are going to do and often cannot remember what they did do or why they did it even when presented with facts. And while better, direct response results show what works but knowing that something works means testing every variation to determine whether it will work in other settings. Knowing why something works allows one to expand on the practical application of that knowledge and itself might result in better choices about what to test.
The new measurement technologies that can be added to direct response results are:
* Electro Encephalography (EEG);
* Magnetoencephalography (MEG) — fast imaging;
* Functional Magnetic Resonance Imaging (fMRI) — brain activity;
* Eye Scan Tracking – “heat mapping”;
* Reading Micro Expressions (“Lie to Me”); and,
* Behavioral Marketing Testing.
Neurofundraising is about using these new technologies to understand how our brains work and react to improve fundraising results. It isn’t a substitute for direct response testing but it guides our thinking on what to test and what might work.
Every experienced direct response fundraiser (and major donor fundraisers) knows that telling stories outperforms reciting facts. Which do you think works better:
“We fed 2,540 children every day for a year at a cost of $3.24 million.”
“At age 11, Sally was the oldest of three and she was responsible for foraging for food for her younger siblings . . .”
If neurofundraising is truly science-based, one would expect not only new findings but also confirmation of that which has proven to work best over many years. There are numerous neurological studies, mostly using fMRI, which show significantly higher levels of brain activity when presented with a story vs. facts and the portions of the brain most associated with experiencing pleasure are more active during storytelling vs. recitations of facts.
But, what good is science if it only confirms that which we already knew?
A commercial study showed placing the statement “You can trust us to do the job for you” at the end of an ad caused trust scores to jump as much as 33 percent. It caused increased scores in the areas of fair pricing, caring, fair treatment, quality and competency. In fundraising, one of the most important brand values for charities is “trust.”
But how often are tag lines or other non-mission related cues used to emphasize that value?
* Do we use tag lines such as “A charity you can trust!”;
* Do we offer a “money back guarantee if you become dissatisfied with the work of our charity?”;
* Do we use third party endorsements that would enhance credibility?;
* How do we demonstrate that we trust our donors?;
(a) Mailing a stamp and saying we hope they will use it to mail back a response?;
(b) Mailing a check and saying we hope they won’t cash it?; and,
(c) Sharing confidential information with them because they are important to the organization.
Our brains make us feel good when we help others. This can be seen in measuring the human oxytocin-mediated attachment system (THOMAS). When we demonstrate that we trust others, they reciprocate. For those engaged in direct response fundraising — does this help explain the functioning of a front-end premium?
Neuromarketing studies show the effects of subliminal or brief exposure to cues such as images or words on the eventual results when you are later asked to take action based on those images or words. It’s a technique known as “priming.” Showing a back-end premium such as a blanket or T-shirt in use during a direct response television (DRTV) ad, before offering it to the donors who agree to become monthly sustainers, can improve response because the premium has already been positively shown in another context.
Did you know that handing a person a warm beverage at the beginning of a meeting causes the prospective donor to describe you as a “warm person”? Did you know that sitting to the left of a prospect or approaching from the left will allow you to have a greater influence on their emotions? Did you know that even a 16 milliseconds subliminal image of a smile (or a frown) will affect how much people would pay for a drink or can cause an unconscious shift in the emotional state of the prospective donor?
Fundraisers of all types, (not just direct mail fundraisers but those who solicit major gifts face to face) would do well to study commercial neuromarketing research results and ask themselves, how these learnings might apply to fundraising work.
Geoffrey W. Peters is CEO of Moore DM Group. He’s presenting a workshop on neurofundraising next month during the annual Bridge To Integrated Marketing conference in National Habor, M.D., near Washington, D.C.