You want to help Ukrainians in need. Should you donate to Unicef, UNHCR, Red Cross, World Vision, Caritas, Save the Children, or some other charitable organisation?
There are so many charities, and charitable causes, to choose from.
Australia, for example, has more than 57,500 registered charities (for a population of 25 million). The UK (population 67 million) has more than 200,000. The United States (population 350 million) has close to 1.5 million.
They’re vying against direct competitors as well as every other charity and cause. Suicide prevention is up against wilderness conservation. Cancer research against climate change activism. Refugee aid against the arts.
Not all actively raise money — in Australia only about 40 percent do — but that still leaves thousands competing for your money.
And that competition is hurting them.
The Downsides of Competition
Research by University of Washington economist Bijetri Bose suggests greater competition among nonprofits marginally increases aggregate donations but reduces average donations per organisation. Fundraising costs also escalate with greater competition.
There are concerns that aggressive marketing, from phone calls to junk mail to “edgy” advertising, is turning people off donating to any charity.
A classic example is the UK Pancreatic Cancer Action’s “I wish I had” campaign. It compared the 3 percent survival rate for pancreatic cancer to 97 percent for testicular cancer and 85 percent for breast cancer. The campaign attracted attention, but not in the way the organisation had hoped.
Though there’s no hard data proving competition is contributing to donor fatigue, there is strong anecdotal evidence.
The UK’s Fundraising Regulator has been cracking down on aggressive fundraising since a 2015 case in which a 92-year-old woman committed suicide after receiving 466 mailings from 99 charities in a year. Last month it updated its service to stop direct-marketing communications from charities, allowing people to block 10 charities at a time.
In the United States, the Indiana University Lilly Family School of Philanthropy has found that even though total donations have been increasing, the share of Americans donating has declined — from two-thirds in 2000 to half in 2018.
The report doesn’t speculate on the causes, but given the well-established phenomenon of choice overload, it’s reasonable to assume too much competition plays a part.
Unfair Competition
As well as the issues already mentioned, competition generally disadvantages smaller charities.
This was highlighted in a 2020 report by Britain’s National Council for Voluntary Organisations, warning of competitive behaviour’s “negative impact on the sector, people, and places.”
The report’s focus was mostly on competition in bidding for government service contracts, but its conclusions also apply to competition for public donations.
The “uncool” causes also lose out. This is well known in conservation fundraising, where large and cute animals outdo ugly ones.
It also occurs with diseases. The breast-cancer lobby in Australia, for example, has been likened to a “pink steamroller,” diverting funding and public awareness away from other forms of cancer.
Celebrity power has contributed to this. Breast cancer survivor Olivia Newton-John, for example, has been a passionate fundraiser for research, establishing the Olivia Newton-John Cancer Wellness & Research Centre.
So, too, has champion cricketer Glenn McGrath, who established the McGrath Foundation after his wife, Jane, died of breast cancer. The foundation has a high-profile association with Cricket Australia, which hosts the annual Sydney Pink Test to raise money for breast-cancer services.
Is More Cooperation Possible?
Could charities compete less and cooperate more?
Cooperative marketing structures are common in sectors such as agriculture. They are also used in retailing, where small independent stores, travel agents, and news agencies have pooled their marketing resources to compete with large corporate rivals.
Applying this approach would mean, for example, that cancer charities — breast, bowel, leukemia, lung, myeloma, ovarian, pancreatic, and prostate — would fund campaigns coordinated by an umbrella organisation. Proceeds could then be split more equitably, based on expert input about research and support needs.
The benefits of greater cooperation have been talked about for years with not much progress made.
But there’s nothing like an idea whose time has come, and with every passing year the case for charitable cooperation grows.
Editor’s note: This article is part of a partnership the Chronicle has forged with the Conversation to expand coverage of philanthropy and nonprofits. The three organizations receive support for this work from the Lilly Endowment. This article is republished from the Conversation under a Creative Commons license.
