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Research confirms online donors are influenced by how much others have given

Research confirms online donors are influenced by how much others have given

Research by the University of Bristol confirms that people giving online to charity are “strongly influenced” by how much other people have given on the website before them.

According to the study, one donation of £100 listed on a fundraiser’s web page will typically increase average donations from £20 to £30. Equally, one small donation listed on a web page will lower the amounts that are subsequently given by around £5.

The impact of this “peer effect” lasts for at least up to 20 donations afterwards, suggesting that potential donors do scroll through the list of recent donations received before choosing how much to give.

Other findings

• donors do not simply compete to be the top donor, or seek to avoid being the smallest donor.

• how much donors respond to donations made by others does not depend on the total number of donations on a page, but it does depend on the ordering within a page.

• peer effects are not limited to particular charities or groups of donors.

• there is no evidence that the observed effect of past donations can be explained purely by donor behaviour around fundraising targets.

The peer effect research

The research was based on online fundraising for the 2010 London Marathon, using data from JustGiving and Virgin Money Giving. Researchers analysed 300,000 donations given to more than 10,000 fundraising pages distributed to more than 1,000 charities. According to the data, each fundraiser gets an average of 34.5 donations and raises an average of £1,093 in online donations and £335 in reported offline donations.

The study was conducted by the University’s Centre for Market and Public Organisation, and was funded by the Leverhulme Trust and the Economic and Social Research Council (ESRC).

The report’s author Professor Sarah Smith said: “I don’t think it will surprise many people to learn that donors are influenced by their peers. What is interesting is the sheer scale of the effect – and the fact that it can be negative as well as positive. This could be helpful to professional and individual fundraisers in thinking about how to maximise the amount of money they raise.

She added: “It isn’t as simple as donors competing to be the most generous – or avoiding being the meanest. Instead, it looks like they are trying to find what they think is the right level for them personally, compared to their peers.”

In other words, “donors benchmark themselves against the distribution of donations from their peers”.

Peer effects in charitable giving: Evidence from the (running) field) by Sarah Smith, Frank Windmeijer and Edmund Wright from the University of Bristol, is available to download from

www.bristol.ac.uk/cmpo/publications/papers/2012/wp290.pdf

Howard Lake is a digital fundraising entrepreneur. Publisher of UK Fundraising, the world's first web resource for professional fundraisers, since 1994. Trainer and consultant in digital fundraising. Founder of Fundraising Camp.

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