01:38 Mallory Erickson: Welcome everyone. I am thrilled to be here today with Evelyn Gosnell. Evelyn, welcome to What the Fundraising. 

01:45 Evelyn Gosnell: So happy to be here.

01:47 Mallory Erickson: So, why don’t we start with you telling everyone a little bit about you, your journey, what you do today. I’m so excited to be diving into this conversation with you. 

01:55 Evelyn Gosnell: So, I work at Irrational Labs, which is a behavioral design firm, and we work with companies to help use behavioral design to solve for good. So, a recent example would be we worked with TikTok who contacted us and said, hey, can you help us with this huge challenge of misinformation? How can we understand human psychology? What drives behavior? And apply those insights into the specific TikTok user flow to reduce the spread of misinformation. And so, we did this exact work. We looked at the literature review, we looked at the specific context of the TikTok app and said, how can we do this? We designed an intervention that once it was launched, reduced the spread of potential misinformation by 24% against a control group. So, this was tested in an RCT, a controlled trial where there’s a control and then the intervention. And we saw a 24% difference. After this TikTok was thrilled with this result and rolled this feature out globally. 

02:48 Mallory Erickson: Wow. Okay. For folks who are listening to this, can you just wind us back for a second and explain at the core what it is that you do at Irrational Labs? 

02:58 Evelyn Gosnell: Let’s start with what is behavioral science. And one way to think about this is in difference to economics. So, raise your hand if you took Economics back in school. And what did we learn? People act rationally. We maximize our own utility. We look at all the options that we have in front of us and we analyze them carefully and we choose the one that’s going to maximize our utility. So, we’re perfectly rational in all times. And we of course know that is not necessarily true. So, in behavioral economics, we don’t make that assumption about rationality. We rather observe how people actually behave. So, Dan Ariely, our co-founder, has a book on this, it’s called Predictively Irrational. These small ways in which we don’t actually maximize our own utility. We act against our own self-interest, or we’re influenced by things we may not, maybe shouldn’t be. And so, our job at Irrational Labs is to take these insights about human behavior and help companies apply them specifically in their products. So, we work with Google, we’ve worked with Lyft, we’ve worked with LinkedIn. Often, we have worked with them to take these insights and again, solve for good. 

04:08 Mallory Erickson: I love that explanation and it’s interesting because when you say irrational, I think some people might hear that and have a little bit of fear come up in them around if people behave irrationally, then perhaps we have less control than we think we do around our ability to influence people’s behavior. But what you all are demonstrating at Irrational Labs is that there is a lot of science behind this irrational behavior. So can you talk to us a little bit about what you’ve seen in that space, perhaps specifically related to social good or fundraising, and we can dig in around some of those themes.

04:49 Evelyn Gosnell: Yeah, so I think two things. First, it’s predictably irrational, so that’s the key here, is that it’s not just wildly unpredictable. There are ways in which we don’t maximize our utility, or again, I actually think that there’s a positive spin to all of this because if we were perfectly rational all the time, we would essentially be robots. And fundamentally what behavioral science shows us, at our core we are very human. And the good side of that, for example, we care a lot about others. If we were quote unquote rational beings, we would always act in our own self-interest. Even charitable donation would not necessarily be, oh, there’s no tax refund, cool, I’m not going to do that anymore. Right, so. And its core. The fact that we’re fundamentally human, I see as a positive.

05:37 Mallory Erickson: Okay. I love that. And so, outside of rational decision making, you’re talking about emotion as one element. What are all the other elements of decision making that fall into that category?

05:53 Evelyn Gosnell: There’s a lot, and hopefully we get to chat through them. But let’s just start with this core piece of donating, of charitable giving. There’s a term called warm glow effect, coined by James Andreoni at UCSD, I believe. And it’s this idea of like when we give, we feel good about ourselves. And I think for me there’s something really useful to understand about that. I guess putting it bluntly, people donate, part of it is ego-driven. And I think that’s okay to like say that out loud to admit it and actually lean into it. So, like you’ve had people donating, like make them feel good about that fact. Show off for them. Don’t make them post on Facebook. Hey, I just donated this much. That makes them look showing off. But they want that show off effect. If you do it for them, that makes them feel good. That makes them feel magnanimous, that gives them social status. Those things are kind of important. Another example of this, another psychology that’s related in this context at least, is something that we call goal gradient effect. I don’t know if you’d live in the Bay Area. I don’t know if you take public transportation. I take public transportation sometimes, and what happens is, as I’m closer to the bus stop, I run faster. I don’t see the bus. There’s no bus. There’s no rational reason. But as I’m closer to it, you just have this propensity, do you ever do this?

07:06 Mallory Erickson: Yes, absolutely. I’m like, that’s weird, but that’s true. 

07:10 Evelyn Gosnell: It’s true. It doesn’t make any sense. This is called goal gradient effect. When we’re closer to the goal, our motivation increases. We’re like, oh my gosh, I’m almost there, let me make that final stretch. In the context of fundraising, what that means is we are more likely to donate when we’re that last drop, there’s a goal of $10,000 and you are the last 100 or 1000 or whatever it is. You are the one who made the difference. You want to be the one to get that sense of completion. You made that difference in our work. We’re not fighting against these tendencies of how people behave.

How do we incorporate them into our design, into our strategy. 

07:49 Mallory Erickson: Interesting. Something I think that comes up a lot for fundraisers is how to do those types of things in a way that also feels real and authentic to the organization and to the fundraisers. So, one of the interesting things that I think we see in the nonprofit space is, you know, like we just had end of year fundraising. And we just had end of year everything Cyber Monday and all the Christmas shopping. And we all got tons of emails about Crate and Barrels sale, or whatever thing you subscribe to. And we open them or we delete them. We don’t really have an emotional connection to them. Some people pushback when they feel like a nonprofit has asked them too many times at end of year, and they don’t feel like there’s this relevance around the goal. Like their need as a nonprofit is always there. So, why this sort of big countdown timer to December 31st, what does that really have to do with the impact the goal of the organization? And I really agree around the need to create relevance when you’re creating urgency, when you’re creating the goal. But it’s interesting to me to what feels a little bit like a double standard around, well, why is Crate and Barrel emailing you five times today as opposed to other times of the year? And sort of the expectations we have around the nonprofit sector. I’m curious from a behavioral science lens, what you think about that.

09:20 Evelyn Gosnell: So, I think there’s a couple things there we can talk about, like timing strategies and like what do you do in December? What do you do in January? There are obviously very different ones going to be in play. I think there’s something around goals and specificity also that can matter. So, what I’m hearing you say is, does it feel arbitrary to some people? Does it feel made up? And maybe. I still think that goals are a very powerful thing and should be used. And imagine instead of December 31st goal, it was an actual goal of, we’re looking to hit this amount, ideally. And so, let’s shift and talk about this next principle that I want to talk about, which is concreteness. So, $10,000 or $1 million. It’s a little vague. How motivated am I about the million-dollar goal versus if it’s, maybe it was 3 million mosquito nets for the year, but what was the monthly goal or what was the weekly one? Because then you’re going to have a smaller number, which is going to make the ask of like, hey, can you donate a hundred, feel like a bigger part of the pie. And that’s back to leaning back into like ego. That’s what I want your listeners to think about. Go smaller with your goals so that people can feel like they’re a bigger part of this. So that’s part one. The next point that I’m weaving in here is around concreteness. So, we just care so much more about a specific thing and about a specific person than the big overall problem, global poverty, famine, et cetera. And this is where again, it’s a little bit irrational. We should ideally care about those things, those big worldwide problems that we need to solve. And unfortunately, that’s just not how we work. You know, the famous, unfortunately, Stalin quote on this, you know this one? 

11:05 Mallory Erickson: Maybe I do, but I don’t know it’s him.

11:06 Evelyn Gosnell: He said something like, the death of one soldier is a tragedy. The death of 1 million is a statistic. We should quote unquote, rationally care much more about the 1 million, and yet the story of the single soldier and seeing his picture and knowing his name and his age and he’s from this town, et cetera, is more compelling, more motivating for us.

Then this is very well supported in the research. So, there’s a study at Carnegie Mellon, they were doing fundraising and they did this exact thing where they said, we’re fundraising to help a clean water initiative in West Africa. We’re going to help these villagers. And then it was a more broad ask about like poverty issues around the world. Two x more donations in the specific condition. That is huge, right? 

11:55 Mallory Erickson: Wow. Yeah. That is so interesting. Is that related to just our ability to visualize the individual story versus the number that is so big? 

12:11 Evelyn Gosnell: Yeah. My guess would be this probably has evolutionary roots when we lived in societies of like a hundred people. That’s all we can kind of process, and we’re more likely to care about the story than like, I mean, for me, you start saying thousand to million. They’re just not as compelling. So let me give you one more example here. This is also called, by the way, identifiable victim effect. So, this is the idea of making the quote unquote victim come alive in your head, to have some net sense of the greater specificity there, the better. This was done by Deborah Small, who’s a professor at Wharton. And this was with donations for Habitat for Humanity. The interesting thing there was, they were fundraising and they were saying that the family has already been selected in one condition, and in the second condition it was the family will be selected. These are almost the same and yet much higher donations for the group that said the family had been selected. It’s such a small difference, but on the spectrum of whether the victim is identifiable or on the other side, a statistic, it’s one notch over. Right? And so, that helped increase the donation. And here’s the kicker. If you try and then add statistics, so imagine you say, hey, this family and they’re in this town in Texas, and we’re going to build this home for them. And you know you’re going to donate. Then you can add some statistics to really bolster up your argument. You’re going to add some statistics, some gravitas, some credibility. Boom. It’s worse when you add the statistic, your numbers go down. It’s wild.

13:46 Mallory Erickson: Wow. That is wild. This is pulling me towards a topic that I knew I wanted to talk about with you. And I think there’s this interesting correlation here because we’re talking about what types of prompts or invitations in a specific moment drive certain behaviors for the donor. And when we think about fundraising, there’s this real tension, I think in our sector around fundraising where fundraisers are consistently being told, don’t be transactional. Don’t just focus on this moment of conversion or transaction. Build the relationship. Keep storytelling. Make people more problem aware, but that element of their job, we don’t know how to measure it in the same way. And we see in hard Economic Times, one of the first things that gets cut from a fundraiser’s budget or a nonprofit’s budget is marketing, which does a lot of those elements. So, I have some concerns about the behavior that a fundraiser takes today, or an organization takes today, how that then ultimately impacts what we see downstream when they’re being prompted to participate in a campaign. So, assuming that in the campaign elements, those have all been optimized with the things that you’ve already talked about, they’re using all those strategies. I think this is called recency bias about what we see today plays in our future behavior. 

15:20 Evelyn Gosnell: Yeah. What you’re talking about a little bit is how do we keep salient and how do we keep people caring about the thing, right? And so, there is absolutely value in those reminders in bringing back that connection. By the way, one principle that I would lean into heavily here is identity. For the first ask you should keep it small. I’m asking for this first-time donation, but once you’ve gotten it once, you now want to create in that person an identity of like, oh, I support this. I am a supporter of the environment or supporter of insert the blank. You want to create that identity so that you’re driving those repeat behaviors. So, remember we started with my example with TikTok. So, let me just come back to that one for clarity purposes. So, one of the things we do in behavioral design, the first step is you do a literature review. This is likely already been studied. Let’s look at what the research shows us. And the companies that we work with, we are often working with product managers. They don’t have time to go over, read all of this so we go do it for them and we come back with the TLDR, and specifically how we should apply that insight. So, in this case, there was some wonderful research done at MIT on accuracy. And it turns out that we really care about accuracy. Most people don’t want to share information that is inaccurate. The challenge is that they don’t have this value in the top of their mind. I don’t walk around in the world humming to myself, I care about accuracy. I care about it. It’s a general thing that I have, but I need this just in time reminder. Because you can imagine a world where you’re solving for misinformation and you want to generally teach people, you know, 100th video on TikTok is going to be an educational video on misinformation. That’s one approach. A just in time approach would be, when they’re seeing a video that’s been flagged by the content moderators as potential misinformation, we put a label on it. In the wording of that label, we use words about accuracy. We’re reminding them of their value of accuracy. This was part of the background of why this intervention worked.

17:21 Evelyn Gosnell: To tie it back to what we’re talking about here is, people may want to be magnanimous, may want to feel generous, may care about the environment or women or whatever the issue, but we want to bring examples top of mind. And the closer we can tie them, the better. I think this would be very difficult from a marketing standpoint, but if in your marketing email, if I got to tell you that by the way you donated to this woman who’s this age and here’s her picture, and she got this from your donation, that’s just going to be much more powerful. The more specific you can get, the better. Maybe logistically challenging to do, but that would be the ideal. Does that make?

17:59 Mallory Erickson: Yes, and maybe I don’t understand recency bias, like exactly what that is. But I think what I hear you saying in these examples is, the more we are building the identity between the donor and the organization in all of the touch points, the more motivated they’ll ultimately be when they’re being given a prompt to behave a certain way again. So, if we can reflect back to them in those marketing touch points, their values that made that thing happen, whether it’s how their donation was used or the shared values that allowed the organization maybe to have a legislative win, for example, and they were part of signing the petition. If they’re really intentional about reflecting back the shared values to the donor, that’s going to continue to build that identity piece, and then the downstream impact of that is going to be reflected in their fundraising. 

18:58 Evelyn Gosnell: Yeah, exactly. You want to bring it top of mind because life is busy. They’re doing a lot of other things, and so you want to build that story and with concrete recent examples so that they’re top of mind. So, when the next ask comes, that sense has already been built up. So, let me give you an example of this in the weight loss space that I worked on called Shapa. And this was about creating a daily habit of stepping on the scale. That is correlated, by the way, with weight loss for the research. So again, we’re going to incorporate that in our product design. And so, we did something that many products do which is streaks. We wanted people to have streaks. I don’t know, for me it’s Peloton. I have to maintain my Peloton streak. This is loss aversion. This is the principle of loss aversion, that we value something that we have and we don’t want to lose it. So, that is what we had in play here. They’re very helpful in some ways, but the risk of streaks is the moment that someone breaks the streak is the highest probability moment that we might lose them. So, in the design of our dashboard, we did not want to just have front and center, your streak in your 99 days, a 100, 101, 102, 103, and then all of a sudden, you’re at zero. That is just a big deal. So, what we did is in the design, we put Shapa member since, in addition to the streak, so that there’s now two narratives happening at the same time. Yes, I had a streak and I did break it. But overall, look, I’ve been a Shapa user for three years. And that’s more important than a 100-day streak. So, that’s what I’m talking about, like identity for you all. How do we build that as a core part of something that they see themselves as so it’s less of a, I’m a one-time donor to X, but I am a supporter of this, this is what I do, this is who I am. 

20:46 Mallory Erickson: Okay. This is really interesting when I think about lapse donors. So, a donor who hasn’t given in the last 12 months but had given consistently before that. We know in fundraising, like sharing lifetime value with donors can be really helpful, which is, to your point, I’ve been a member since, I’ve been giving since, and throughout my entire experience with the organization, I’ve given blank. And, I wonder how the research that you’re mentioning here could impact how a fundraiser behaves when a donor laps. Like, is it better for them to reach out to that donor right in that moment and sort of call out like, we missed you this year? Or is that acknowledgement of the laps, the streak break or something like that, damaging in some way to the person’s identity, where it would be more beneficial to not necessarily mention it, but do something really intentional to prompt them to give.

21:50 Evelyn Gosnell: Yeah, that’s a great question. I’m not familiar with any research on this specific thing. We could look it up and see if there is, that’s again what we should always do. My intuition would be that you would want to go for it right away.

22:01 Mallory Erickson: And mention it. 

22:02 Evelyn Gosnell: Mention it. Yeah. So ideal scenario, there’s already research. We check, we look and we act accordingly. I don’t know the results of this, if there is any. If there isn’t in the perfect world, we actually run our own experiment. You test, you take your population, you randomly assign, these are going to fall in this group and these are going to fall in this group. And we then measure the results. But my hypothesis, you should always have a hypothesis when you do these, and so you can measure yourself against them and see if you’re right. We at Irrational labs bet each other lunch on who wins. 

22:31 Mallory Erickson: I love that. 

22:32 Evelyn Gosnell: We tend to be right about that. But what’s harder to guess is the difference, right? Is it going to be win, win by 5%, 10%, how much? The point is to say, is it true that addressing it directly is the right answer, that’s question one. And then question two would be, what would be the right messaging? So, in one world you could almost imagine like, it was an oops, you could freak, you could have a positive assumption that they just forgot, oops, you missed your thing. And I could imagine we could brainstorm different strategies on how you might want to do it, the different behavioral techniques, but you could then test, is it just the timing if you are going to address them right away, what message are you going to use? 

23:12 Mallory Erickson: Okay. I love that. I want to go back to the piece that we were talking about before around identity and messaging and how our experiences today do or don’t impact our future behavior. Because you were talking about memory and staying top of mind. And I guess I’m wondering, let’s say that you haven’t been able to stay top of mind for whatever reason, like there’s been another crisis happening. And so, what your organization does is just not at the forefront of a donor’s mind when they’re making a decision around their identity, like is this still a priority for me. What are they factoring in, in terms of their historical relationship to the organization subconsciously, of course? But what are the ways that that organization can be committed to continually building that relationship? So even when they’re not top of mind, there’s still some like core identity alignment. 

24:13 Evelyn Gosnell: Let’s take concrete examples. Right? I think the big ones in the world right now is, we had Syria and then we had Ukraine, or even like Afghanistan. Afghanistan was an issue. It was in the press a lot, the stories, girls’ education, there’s a thing that we cared about. And then the war in Ukraine starts and there’s just less mental mind share, number one. And two, maybe there actually is a smaller pocket. Maybe some people did give to Ukraine and so now they’ve given to Ukraine, and how do you get them to give back? I certainly am not going to stand here and say, cool, the trick is behavioral science and you can get your donations all the way back up to what? I can’t say that. I think it’s a real challenge, this idea of primacy and what’s salient in our minds. So, I think you’re up against a big hurdle. And so yeah, how do we lean into the people who donated to girls’ education in Afghanistan before? How do we get them to reconnect with that? I think that is the challenge on the table. One thing we haven’t talked about yet but is certainly a tactic that can and should be used is the idea of norms. Social norms are basically like, other people are doing X, so you should do X. And this is another one that falls into irrational because we don’t pride ourselves on this. If I tell you, you just follow a behavior of others, right? This doesn’t make us feel good. And yet it’s a super powerful thing. There was one study, I like this study, it was done in Sweden. And it was telling Swedish students, I think the fundraising drive was for people in Uganda or something, and they told students that, by the way, 70% of Swedish students donate to this initiative. That’s group one. Group two is, by the way, 70% of Swedish students at this university, insert name of university, your university donated. So not only is the norm more powerful than not giving the norm, the more specific norm is more powerful than the general norm. So, in a world where let’s say pockets are tighter, we’re in economic tighter times, how do we kind of create this norm of, by the way, people are still donating, others are still finding a way to donate. And the more specific you can make that norm closer rather than the population in general. It’s like, women in Wisconsin are still donating, or narrowing the group to greater specificity. 

26:33 Mallory Erickson: That has some interesting implications when I think about Facebook ads, for example, that drive towards donation pages or campaigns and the ability to segment audiences based on certain identifiers and then create copy that really aligns with the audience who’s going to see it. There are some ways in which we can do that inside our email systems with location and perhaps other demographics we’ve collected. But that’s really interesting to think about and really good to know. I don’t think it’s something I’m seeing a lot in the fundraising space, so I appreciate that.

27:09 Evelyn Gosnell: Yeah. And I think if I were doing this, I would explore, for me it would be an open question of what type of norm should I set? Question one is like, what do I have access to? You could think about it demographically, like women in Wisconsin, if I’m targeting a woman in Wisconsin. Or it could be interesting to target behaviorally. So, let’s say, last year I donated twice. So, could I group you with people like you who donated twice donating this much. You know, there could be something to explore there. This is how behavioral sciences minds thinks. Like, I would explore it, could I be wrong? Maybe. Let’s test it. 

27:46 Mallory Erickson: Yeah. That’s really interesting. So, you were using the term identity before, and you’re talking here about norms. Is there a difference between norms and identity, or are norms the identities that the organization is reflecting back?

28:04 Evelyn Gosnell: So, when I was talking about identity earlier, I mean building up this idea of the donor’s identity as a donor to X. So that’s what I mean. So, you’re a supporter of women in Afghanistan. Building me up with that as part of my identity, so now this decision not to donate, it’s not a yes no. You know, right now it’s like, can be easy for me to decide, no, I don’t want to donate. But if you’ve made this part of my identity, I am just someone who supports women in Afghanistan. It’s less of a decision. Like it’s already a foregone. It’s closer to a foregone conclusion if you’ve successfully built my identity as a supporter of women in Afghanistan. Does that make sense? 

28:48 Mallory Erickson: Yes. Absolutely. And do you have some additional strategies around that? You shared about sort of the reflection back of values. Is there anything else we can learn from behavioral science around how we build that identity? 

29:01 Evelyn Gosnell: Yeah, so I think you talked a little bit about the history of donation. So behavioral design is about getting very specific. So, how could I show you visually? Let’s say you donated for the past four years? I wouldn’t just put the number. Mallory- 4 years. I would show the year, 2018, donation check, 2019 donation check, 2020 check. We would show it more, I would try to think about how do I make this more compelling? So, it looks like there’s something missing. 2023, oops, there’s a gap. Oopsies. How do we fix this? Versus taking just the number 4 years. And by the way, I would do the timing and the frequency. Don’t do the total number because of course that’s just going to be like, look, I’ve already donated $10,000 to you all. You don’t want to bring that in most cases. 

29:53 Mallory Erickson: I love that idea of that type of visual and using additional engagement strategies. So, it’s not just a number that gets lost in there, but it’s really clear. I love that. Something that keeps coming up for me as you’re talking and I don’t know exactly what this relationship is, so this question might be a little bit unclear. But donor trust is a very common thing we hear talked about. We hear a number of statistics around donors not trusting nonprofits for a variety of reasons. I’ve seen some mixed signals around that in recent years around whether or not trust in nonprofits is going up or down. But it’s certainly a very common fear of nonprofits that they are not building donor trust. What works in terms of building trust with your community and what breaks trust? 

30:45 Evelyn Gosnell: Short answer is, transparency is the key to trust. And with companies when we work on this, you can also even call this operational transparency. This is like, being clear about the things that are happening behind the scenes. So, cheesy example, you call an Uber, you’re waiting for a minute and a half, two minutes. What does Uber do? It says, oh, right now I’m looking for drivers, right now I’m matching it with driver, right now the driver’s coming to you. So, you’re explaining the steps that are happening and helps people not be as annoyed with the time. And this is what we call operational transparency.

And we’ve seen this in countless examples of how do you more clearly, more act in the donor’s best interest, not just in your own best interest. That’s another key component of trust is acting in the other person’s self-interest. So, I think that’s something to think about as well. 

31:40 Mallory Erickson: That transparency piece is really interesting to me. I feel like in the nonprofit sector, what it rubs up against is a lot of perfectionist tendencies and a lot of fears around not appearing perfect or having it all together or all buttoned up. The operational transparency piece is more clear for me around letting people into the process. And I actually think that holds a lot of really interesting implications when we think about how to build even campaign transparency or project and program transparency where we aren’t running fundraising campaigns that are like, solve world hunger with this like $25,000 campaign that we all know is not going to solve world hunger. But how do you think about it in terms of when something goes wrong, how does an organization or company balance that perception of confidence in having it all together with that transparency piece in a way that maintains trust? 

32:39 Evelyn Gosnell: Yeah. So, let me give you an example with companies that we work with. But let me give one that could be a little bit closer to you. And this is, I think the city of Boston did a really nice initiative here on something really simple, potholes. You can imagine potholes are annoying, people don’t like them, and it feels like they’re never getting fixed. So, what they did is they created a website and all of the pothole issues were captured on there. Were they all fixed right away? No. But what you could see is like, you know what, that one over there, there was an issue and now it’s fixed, and now this one over here is getting fixed. So, in no universe did Boston commit to, we’re going to fix all the potholes right away. But what they did was say, here we are, here’s the problem. And this is key, you have to show some degree of progress. This one’s being resolved; this one’s being resolved. So that gives people this sense of, okay it’ll be taken care of. There’s somebody who’s looking at this, they’re moving the needle in the right direction. 

33:35 Mallory Erickson: Oh my gosh, I love that. That just gave me so many ideas for different organizations I work with around how they more publicly monitor different elements of their program. Like, I have one organization that gives out grants to folks who apply through the foundation’s small grants to families who are facing some critical decisions in their homes.

And so, they have all these requests coming in that could populate anonymously, maybe some more publicly. And then as the organization is granting out to these different families, they could track that publicly. I love that idea. Okay. What if I…

34:13 Evelyn Gosnell: Can I [inaudible34:13] that one? So, you probably can’t do in that scenario, when you’re talking about these families. You probably can’t give the names of the families. But if we were thinking about the ideal world, just from a pure behavioral science standpoint, you would be hitting the nail on the head there because you would have that specificity and concreteness as well. I’m not suggesting it at all, I’m just saying that sometimes it’s a useful exercise to at least know what the ideal is. Let me give you one more, I think, really interesting study that is helpful to know in this context. This is from Uri Gneezy at UC San Diego again. And this study looked at something that is done very commonly in the charitable donation space, which is matching. Matching is a little bit mixed on whether it works and how effectively it works. And so, in this case, what was interesting is that he tested not just this idea of matching, like, oh, there’s this donor, right, and they’re going to match two to one, or whatever it is. But there was also a condition where they said, look, a donor has already come in and they’ve paid the overhead costs. And so, if you donate, your money is going to go straight to buying the mosquito nets. We’re going to take your money; we’re going to buy the mosquito nets or the school books for the girls in Afghanistan. We’re going to buy this many books with them. And that was the winning condition against the matching. But the financials were the same. The baseline amount that that original wealthy donor first gave was the same. The math was the same, but how we thought about it psychologically, and this goes back to where we first started, so maybe we’ve kind of come full circle. Part of understanding and doing this well is accepting and embracing that humans are human. And we have a little bit of ego about this. We want to feel like we were the ones who made the difference. And in his study, the way he designed that, where your money isn’t going to overhead, but it’s going straight to the people you care about was more effective. 

36:08 Mallory Erickson: Okay. I know we only have a few minutes left, but I’m going to try to go here if you’re okay with it. So, you are hitting on probably the most tender tension in the nonprofit sector. No, which is great because actually this begs a really important question. So, the overhead myth around the fact that overhead doesn’t ultimately lead to impact the same way program expenses do, is really problematic for nonprofits. And it’s something that a lot of nonprofits continue to perpetuate. And so, what you’re saying, that I’m glad you said around using behavioral science is about understanding how people actually behave. And so, one of the things that I’m wondering about though is, can we use behavioral science to challenge this overhead myth? And this is obviously untested, but in terms of what you might hypothesize, are there potentially ways that we could talk about the impact of overhead? Do those more personal individual stories like build identity with donors, not just that they are people that solve this problem, but they are people that give to healthy nonprofits that are going to be sustainable pillars of addressing this problem for years and years to come, not just some band aid. Can we use some of those same principles to do this? 

37:31 Evelyn Gosnell: Yeah. So, let me say outright, like I’m not saying this whole overhead study is interesting, and it’s a little bit of an inconvenient truth, right? This is how people are behaving because we know that overhead is needed. Somebody needs to be the purchaser of the nets and coordinate all of those things, and I would call this quote unquote, inconvenient finding, because ideally, we would just want people to be perfectly rational and understand that overhead is a thing and is a required part of it. So, this is where I might think about different user types segments. So, at the highest level, the largest donors may be in a place where they are more knowledgeable, more equipped to hear these messages, more at baseline probably knowledgeable about. If people are regular high-level donors, they understand some of this, how this works. And on the spectrum of like emotional versus rational, they’re probably closer to the rational side. The overhead story, to really do it well takes too much time, I think. So, I’m resolving for that first donation. Then I can use identity. I can build these things longer. So, maybe a segmented approach. How does that land with you? 

38:41 Mallory Erickson: Yeah, I think we’ve seen that to be effective. Exactly what you’re talking about. And I love what you said about, it’s an inconvenient finding and I think that is like the space so many of us find ourselves in so often is like, what we want to be true and what we know to be true deep down. And then how people behave when faced with that truth is a totally different thing. And I think recognizing that behavioral science gives us a really important lens and tools to be used as close of alignment as possible to how we want to show up as organizations. Some organizations might say, you know what, like even in the small campaign, small dollar donations campaigns, we don’t ever want to do a 100% to this campaign. And I think the best fundraising, in my opinion, happens in alignment with who the organization is. It’s like the moment that like genuineness is broken. Like I’d be really interested, there’s no way to actually look at this, but my hypothesis is that the matching piece is unclear about its effectiveness because of how genuine some matching is and how disingenuous other matching is, which makes it impossible to really compare apples to apples because sometimes we have the money no matter what or we’ve created this. Right? And anecdotally, I feel like I’ve seen it in organizations that I’ve worked with too. So, yeah. 

40:10 Evelyn Gosnell: One of the arguments against matching has been that it diminishes intrinsic motivation. You’ve put it again. You’ve put people more in a rational mindset rather than emotional. Oh, I’m compelled, I want to give. It’s more of a financial calculus and which makes it more of a reason to do this one time, but you may not be as likely to get kind of ongoing. Like next quarter when there isn’t a match. You’ve now given them a reason that they won’t donate because last time it was kind of like sales. It’s kind of like the JC Pennies of the world that gives all these coupons. Well, why would you ever Bed, Bath $ Beyond? Why would you ever go to Bed, Bath & Beyond without the coupon? If you don’t love that. So, it’s something to wonder. 

40:50 Mallory Erickson: That’s interesting. Oh, that’s really interesting. And maybe a reason to only use matching perhaps, or to test this with donors who have been repeatedly engaged in your organization as an additional incentive as opposed to that first time acquisition where then that’s like foundational in their relationship to you. Thank you so much. I could ask you about 50,000 more questions, but I really appreciate this conversation and I’ll make sure all of the links are below for folks to find you and learn more about Irrational Labs. Is there anything else you want to leave folks with today? 

41:28 Evelyn Gosnell: Yeah, enjoy the space of nerding out to how our psychologies play into our behavior. We have a lot of public examples, case studies, tools on our website, irrationallabs.com. So come join the fun of nerding out. 

41:43 Mallory Erickson: Thank you so much.

Alright, there is so much inside this episode. I wasn’t lying about the fact that you might want to listen to it twice, but here are some of my top takeaways. 

Number one, human behavior may be irrational, but it’s also predictably irrational. So, there are specific scientific principles that we can understand and leverage around donor behavior.

Number two, the more specific and concrete your goals, the more easily relatable and donatable your constituents will find them. 

Number three. I thought it was such an interesting data point that far from bolstering your cause research has shown that adding statistics to heart-centered pitches can actually drive donations down.

Number four, if you feel like your organization’s cause has been sidelined by other world events, you need to look to reconnect through specific examples of peers who have remained active donors. This is where marketing continually comes in. 

Number five. Here’s an idea for reaching out to donors who have given historically but missed a year. I love what Evelyn said about providing a visual cue that shows the long-term commitment as well as an interruption. And demonstrate that it’s not too late to get involved. 

And then lastly, that operational transparency piece is a huge component of trust building. I loved that so much. And again, this is where fundraising and marketing have to come together. Don’t be afraid to give donors a window into your nonprofits on the ground reality, however imperfect. 

Everything that she said around recency bias and staying top of mind, building trust and relationships with donors. Everything is both marketing and fundraising. It’s just about employing different capabilities together toward our shared goal. 

Okay. For additional takeaways and tips inside this episode, head on over to malloryerickson.com/podcast to grab the full show notes and resources now. You’ll also find more information there about Evelyn and our amazing sponsors, Feathr. Thank you for spending this time with us today. If you enjoyed this episode, we would love it if you would give it a rating and review and share it with a friend.

I am so grateful for all of my listeners and the good, hard work you’re doing to make our world a better place. And if you miss me between episodes, stop by and say hello on Instagram under whatthefundraising_ Have a great day and I’ll see you next week.