How much a charity spends on overhead can have a powerful impact on donors weighing whether to support the group, a nonprofit strategist and blogger writes in The Huffington Post, citing new research on giving patterns.
Brady Josephson notes a recent study in Science magazine in which researchers found that donors gave almost three times as much when told a group’s overhead costs were covered by an outside source, compared to a standard “ask”—far more than when matching funds or seed money is mentioned.
The study reinforces that emotion is a key driver in decisions to give, according to the writer, a critic of author and consultant Dan Pallotta’s argument that charities should spend more on administration and solicitation so as to grow and have a greater impact. Feeling that their money is going “to the cause” matters to contributors, who “care more about how impactful their donation is as opposed to how impactful the organization is,” Mr. Josephson says.
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