Donating Our Money Is Irrational, So Why Do We Do It? Tim Kachuriak Explains Our Motivations
Tim Kachuriak is the founder and Chief Innovation and Optimization Officer for NextAfter, a fundraising research lab and consulting firm that works with businesses, nonprofits, and NGOs to help them grow their resource capacity.
By his own admission, Tim is not a behavioral scientist, but what we love about Tim’s work is that he is using knowledge and research from the world of behavioral science and applying it to improve the efficiency of gift giving for nonprofit organizations. And not only does he use behavioral science techniques, he tests the theories in the nonprofit sector and generously publishes the findings on the NextAfter website.
In our conversation with Tim, he underscores the need for thinking about value proposition, a term widely used in the digital marketing world, but rarely thought of in terms of nonprofit organizations. He argues that potential donors are constantly weighing up the perceived value vs. the perceived cost of donating their money.
Tim also brings up the idea of reducing friction for donors: how can the giving experience be improved to make donating money a more seamless transaction. And we couldn’t help but see the parallels with the infamous new behavioral science book NOISE coming out later this month (Noise: A Flaw in Human Judgment by Kahneman, Sibony and Sunstein, 2021).
There are many reasons why we donate to nonprofits; emotional reward, belonging, anger, guilt (or as Tim positively reframes it – gratitude!). Understanding these motivations is a huge part of Tim’s work and why, as behavioral scientists, we are fascinated to understand the research he has conducted around donations.
We hope you enjoy our discussion with Tim Kachuriak and if you are a regular Behavioral Grooves listener, perhaps you feel motivated to donate to our work by becoming a Behavioral Grooves Patreon Member at https://www.patreon.com/behavioralgrooves.
© 2021 Behavioral Grooves
(0:06) Introduction to our guest, Tim Kachuriak
(3:50) Speed Round Questions
(5:57) Why do People Give?
(9:41) The Principle of Reciprocity
(12:10) Effective Messaging and Value Proposition
(22:25) Reducing Friction
(40:27) Grooving Session
(58:44) Bonus Track
Other Episodes We Talk About
Robert Cialdini, PhD: Littering, Egoism and Aretha Franklin https://behavioralgrooves.com/episode/robert-cialdini-phd-littering-egoism-and-aretha-franklin/
Linda Thunstrom: Are Thoughts and Prayers Empty Gestures to Suffering Disaster Victims? https://behavioralgrooves.com/episode/linda-thunstrom-are-thoughts-and-prayers-empty-gestures-to-suffering-disaster-victims/
Hey groovers, just wanted to let you know that somehow, at 29:28 of the podcast we ended up cutting Tim’s response to the Susan G Komen question and can’t find it on the cutting room floor…sorry about that. Here’s the transcript to Tim’s complete answer:
“There’s a Wonderful podcasts from about probably 10 or 15 years ago, not a podcast, I’m sorry, it was a TED talk, a guy named Dan pelada. wonderful guy, brilliant. But he points out a lot of the problems that exist in the nonprofit space, there’s almost like these glass ceilings that have been established. And we have to play from a completely different set of rules. And the rules are designed to basically like, keep us, you know, small, right. And so one of the points he brings up is that there’s kind of like this conflation between efficiency and impact, right.
“So for example, one of the big things that most people are trained to look for now is what percentage of my dollar is going directly to the program, right, going directly to like research, in the case of Susan’s, you come in what percentage is going to administration, which would be things like fundraising, marketing advertising. And the problem with that is that it kind of limits the ability of the organization to really grow and do something big, like be able to raise enough money that can ultimately solve a huge problem like cancer.
“So for example, if I have two organizations, okay, this will kind of explain this problem with efficiency versus impact, if I’ve got two organizations, they do the exact same thing. One has an annual budget of $100 million with 50% efficiency, which means 50% of every dollar goes directly to you know, whatever it is they do. The other organization is a million dollar organization with 99% efficiency, right? Which one creates more impact, which one is doing more for the cost? Right? So so that’s the problem with sometimes, you know, kind of putting us in the box like that is that it really limits the potential for us to be able to solve these huge social and like, you know, health problems in the world. So So that’s, uh, maybe definitely go check out his TED talk. I think you’ll love it.”