Last week, the New York Times published an article on the Donald Trump campaign’s widespread use of an “opt-out” checkbox on its online donation form. The campaign wanted to raise money quickly and sign up more recurring donors who might not take the time to read the fine print and uncheck the box to opt out of future automatic contributions.
“As the election neared, the Trump team made that disclaimer increasingly opaque,” the Times reported. “It introduced a second prechecked box, known internally as a ‘money bomb,’ that doubled a person’s contribution. Eventually its solicitations featured lines of text in bold and capital letters that overwhelmed the opt-out language.”
That strategy ensnared hundreds of thousands of loyalists of the former president, many of whom were surprised and outraged by the mounting charges. “Banks and credit-card companies were inundated with fraud complaints from the president’s own supporters about donations they had not intended to make, sometimes for thousands of dollars,” according to the article.
Ultimately, the campaign refunded 10.7 percent of the money it raised on WinRed, its for-profit online donation platform.
The prechecked box on donation pages is not unprecedented in political fundraising. And while many nonprofit fundraisers may disapprove of the tactic, some charities have also used opt-out tactics to automatically increase the size of a donor’s recurring gift.
Shanna Marzilli, chief marketing officer at Plan International USA, spoke to the Chronicle in 2019 about the organization’s success increasing donation sizes this way.
A direct-marketing agency had suggested this tactic based on the success of other groups that had tried it, Marzilli said. Several times as the organization sought ways to cover increasing program costs, it sent notices to donors who made recurring contributions. The notices informed donors who gave by check or credit card that their contribution would soon begin increasing unless they took action to opt out (via email, a phone call, or returning a mailed form). Donors who sponsored one child with monthly gifts would see those increase by $2 a month. Others who supported multiple children or made recurring gifts to other programs may have seen those contributions increase by another amount
Donors who contribute quarterly or annually were also informed of the increase. However, because of banking regulations, donors who make contributions directly from their bank accounts were asked to opt-in to give more.
The opt-out automation helped the charity keep administrative costs down and boosted fundraising totals, Marzilli said.
When the organization increased donation amounts on an opt-out basis in 2016, revenue increased by $1 million, Marzilli said. In subsequent years, revenue increased by $1.7 million a year as gift sizes continued to grow.
Less than 1 percent of donors canceled their contributions after receiving the notices, according to Marzilli. Seventy percent who received the letter asking them to opt out — or opt in, in the case of donors who gave via automatic bank withdrawals — increased their contribution. About two-thirds of the charity’s recurring donors give via check or credit card, and most of them would have received the opt-out notice. Some donors did not receive the mailing, based on criteria like the length of time they had been supporting the group.
The charity repeated a similar campaign in 2019, but not since then, Marzilli said in an email on Wednesday. That 2019 effort was successful, both in terms of increasing donor contributions and retaining donors, she said. Some donors received the increase notice in both 2016 and 2019.
Marzilli wasn’t concerned about donors being caught off guard by donation increases. “Nothing Plan does is automatic,” she wrote in an email. The charity sends multiple notices in the months leading up to the date the increases go into effect, she said. Plan International USA has a loyal donor base and is regularly in touch with supporters, providing updates on children who are sponsored and other ways to engage with the organization.
“We’re always testing upgrade strategies and found that this method was more effective both times it was tested,” she said, adding that effectiveness was measured not only by revenue and return on investment but also by donor feedback and satisfaction.
“Everything we send out, we want to meet our donors’ expectations,” Marzilli said back in 2019. “This is really no different.”
Legal Vs. Ethical
While the strategy may net more money in the short term, fundraising experts are highly critical. They’re wary of its potential to turn off individual donors — and harm the nonprofit world’s reputation.
When fundraisers discuss ethics, they often think about it on a continuum: Is it legal, is it ethical, is it smart? said Robbe Healey, past chair of the Association of Fundraising Professionals’ ethics committee.
“A lot of things that are legal are not ethical,” she said. “In my judgment, this fits in that category.”
The AFP Donor Bill of Rights states that fundraisers must “obtain explicit consent by donors before altering the conditions of financial transactions.” When charities ask donors to opt out, they run the risk of alienating a donor, Healey said.
“Opting out is a passive engagement with a donor, while opting in requires them to actively engage with you,” she said. Nonprofits that are serious about stewarding and cultivating donors “want them to engage with you, not just passively allow everything you’re suggesting.”
Opt-out tactics also bank on people not reading the fine print, said Harvey McKinnon, a fundraising consultant in Canada and the author of Hidden Gold, a book about wooing monthly donors.
“Organizations that do this may make more money, but they are going to tick off a lot of donors,” he says. “It’s basically something that will trick donors who aren’t paying attention, and people resent that.”
Many nonprofits aren’t thinking about the long-term investment in retaining donors, he said. They’re focused on the return on investment in a given month, quarter, or year. But monthly contributors are often the best prospects for bequests and other kinds of planned gifts, and for that reason, “anything you can do to tick off some of them is a mistake.”
Erica Waasdorp, a monthly giving consultant, is especially concerned about older donors who may set their mail aside and miss a notice about donation increases that require their action to stop.
“All it takes is their son or daughter to say, ‘Mom, what is this? Why are you all of a sudden having more money taken out? Did you sign up for this?’” Waasdorp said.
It’s not just a single charity’s reputation with a few frustrated donors that’s at stake. She worries charities that do this “run the risk of screwing it up for everybody else.” These kinds of strategies sow mistrust and provide fodder for nonprofit critics.
Why not just ask the donor to give more? said Waasdorp.
She wrote about the subject on her blog: “You’re always better off asking your donors for permission and to indicate the new upgraded amount they’d like to give. You’ll raise a lot more money, you’ll keep your monthly donors happy, and you’ll keep the future of our still growing monthly giving processes a lot safer.”
Polly Papsadore, director of marketing and business development at PMG, a direct-marketing production firm, said nonprofits need to think about the potential consequences of their actions.
“Donors are sacred to us; we can’t do our work without them,” she said. “We need to treat them properly and just be super careful about how we approach our fundraising.”
