December 11, 2014

The Ups and Downs of Charity at the Checkout Counter

Would you like to contribute $1 to education? $5 to eradicate cancer? $10 to support homeless pets? Questions like these are an increasingly common part of the retail experience for shoppers who get hit up for donations at cash registers across the land. And this season there seem to be more “checkout charity” campaigns than ever.

Reuters recently asked me to comment on this phenomenon, asking if I thought these campaigns worked.  I said my organization's research indicates that, in general, checkout-donation efforts do not drive sales.  That’s not to say they don’t do good or have merit.  And it’s not to say that they can’t drive growth—at least in some categories or through some executions.

But for the most part, speaking from my own experience, I would have to say that checkout charity doesn’t make me feel better about the retailer or make me want to spend more.  In fact, quite the opposite is often the case.  Having a sales clerk ask me if I would donate before she or he rings up my purchase makes me feel ambushed and guilty if I say no.  That makes me resent the store for putting me in that position.

It’s not that I am not philanthropic. I am. But my personal giving is strategic, not merely opportunistic.  It focuses on causes I care deeply about and on supporting organizations that I’m confident deliver the social outcomes I am seeking to achieve.

And I don’t think I am alone in this. That’s why I’d advise charities not to focus too heavily on this inherently unstable strategy for securing contributions. After all, nobody has to make a donation, and as these types of requests for money become increasingly common, people may feel even less inclined to give.

So what are nonprofits to do instead? Here are three alternatives to checkout charity:

Demonstrate value

One problem with checkout charity is that it fails to provide donors with enough information to make thoughtful decisions about what they are giving to. With your wallet already open and the pressures of a line of people waiting behind you, checkout giving is usually more driven by convenience than a well-informed motivation to invest in an organization.

A more sustainable strategy demonstrates to potential donors how your nonprofit can uniquely deliver meaningful social changes. Communicating the important outcomes you produce and your “impact per dollar” makes a donor feel good and smart for supporting you. Nonprofits that pitch value as well as generosity are more likely to stand out from the crowd.     

Cultivate “impact donors”

People give not just to do good but, as economist James Andreoni, explained, because they get a “warm glow,” or a positive emotional response, from giving. Since many people donate to feel a certain way, giving a dollar at the checkout is often motivated by this impulse to feel good or, at least not bad.

It’s true that these “feel-good” donors can provide significant support to your organization. But they can become even more loyal and helpful if they are truly invested in the outcomes you are trying to create. So focus your efforts on gaining the support of impact donors—those who really want to invest in the work you do on a continuing basis.

Form meaningful partnerships

One reason checkout charity is so common is because it’s easy and because companies can end up looking generous—often without investing a dime of their own money.  So I get the appeal.  But does it really drive your brand if the shopper is turned off or simply confused as to why this charity is working with this retailer?  For example, what does a grocery store really have to do with cancer research?  I’m not sure.  But a grocery store teaming up with Feeding America, now that would make sense.  Or Toys R Us partnering with Save the Children.  I get that.  Heck, even my 10-year-old gets that—and she chooses to donate because it resonates with her.

So I’m not saying stop all checkout charity, but I am asking for nonprofits and retailers to consider dong two things to make those efforts less offensive to those of us who are not fans:

1. Have skin in the game.  Rather than just asking shoppers for extra dollars, companies should match donations—at least one for one.

2. Instead of forcing a hasty yes-or-no response, help shoppers understand the bigger picture. Why should they invest in your cause? How is their checkout change part of a larger strategy to create meaningful social change?

Approaching it this way, then at least if I choose to donate, as opposed to feeling pressured, I’ll get that warm glow of giving that