Essec Business School

With ESSEC Knowledge Editor-in-chief

If you’ve been online at all in the last few years, chances are that you’ve seen someone raising money via a fundraising platform like GoFundMe. Now, you can donate via Instagram, Facebook, on your phone, on your tablet, anywhere you have internet access. In short, peer-to-peer platforms like GoFundMe allow individuals to raise money for a cause of their choice with minimal barriers. Usually, the creators of these fundraisers aren’t professionals, and appeal to the hearts of their network. Amir Sepehri (ESSEC Business School, formerly of Ivey Business School), Rod Duclos, Kirk Kristofferson, Poornima Vinoo, and Hamid Elahi (all of Ivey Business School) explored the use of language in peer-to-peer fundraising, finding that indirect appeals - using third person language - tends to be more effective than first person wording, since the audience tends to perceive indirect appeals as more credible. This has implications for how people can more effectively raise money online in a time where such a practice is widespread. 

Crowdfunding (or peer-to-peer) platforms make it easy for anyone to raise money, for themselves or for someone else. These platforms are relatively new, and so is the body of research studying them. What makes some campaigns more successful than others? Could the type of language used play a role? 

They were inspired by advertising and word of mouth marketing. In the former, a rep identifies the product and is likely to benefit from the economic transactions: think an Instagram influencer shilling tooth whitening stripes, and getting commission when their followers buy the product. This is similar to direct fundraising, where an identified individual launches the initiative and will personally benefit from it. In word-of-mouth marketing, third parties promote a certain product they value - like a friend recommending a new toothpaste. This is more like indirect fundraising, where third parties raise money on behalf of another person. Research shows that the latter tends to be more effective, because consumers see it as more credible, since the person isn’t financially benefiting from it, so it seems more genuine. 

Social proof positive

Another factor playing into this is social proof: when we are uncertain of what to do, we tend to look at others for cues, thinking they are likely to have more knowledge than we do. In the case of fundraising campaigns, a third party raising money for their friend or relative acts as social influence. Since we’re flooded with calls to donate, it’s useful to get insight from the third party, someone who knows more than we do about the situation. People tend to use this to decide whether or not to donate, and this social influence lends credibility to a campaign, making people more likely to reach into their pockets. 

Studying generosity 

The researchers studied the role of language in a series of studies. In the first, they looked at real-world campaigns on GoFundMe, examining the wording used in over 9000 campaigns. Indeed, they found that the use of third person pronouns (he/she/his/her) led to more donations, to the tune of $620 per campaign on average. First-person pronouns had the opposite effect, reducing donations by an average of $682 per campaign. 

Why do direct appeals solicit a more generous response? In the next study, participants randomly read one of the two campaigns, as seen below. The two campaigns were identical except for the pronouns.

Implications for the fundraising field

What does this mean for the booming fundraising industry? These peer-to-peer platforms are everywhere, which can overwhelm an audience being continually solicited for money. This means that fundraisers need to pay attention to factors that can make their efforts more successful- and the use of language is one easy tweak. This study shows that campaigns written in a third person voice tend to be more successful, since they are also seen as more credible. With both narratives being virtually equally popular, this work offers a guideline for those formulating an appeal: if they still wish to use a first person narrative, they should seek to highlight their credibility using other words or symbols. Given the implications of charitable fundraising - the difference between saving or losing a pet, or being saved from the brink of bankruptcy due to medical bills - it’s important to keep studying the psychology of fundraising to learn more about how to craft effective campaigns. 

Reference

Sepehri, A., Duclos, R., Kristofferson, K., Vinoo, P., & Elahi, H. (2021). The Power of Indirect Appeals in Peer‐to‐Peer Fundraising: Why “S/He” Can Raise More Money for Me Than “I” Can For Myself. Journal of Consumer Psychology, 31(3), 612-620.