This slideshow discusses the different theories of nonprofit fundraising. It was developed for students at the University of Memphis.

1. PADM 7642 Leigh N. Hersey, PhD Theories of Giving and Fundraising

2. Donor Motivations Internal, external Intrinsic, extrinsic Most people have mixed reasons – helping other people and meeting personal goals

3. Altruism Donor should not receive anything back from the giving process – not even a good feeling. Very rare

4. Identification Theory Individuals are most likely to give to issues with which they identify

5. Moral Citizenship of Care How an individual perceives his or her responsibilities within the moral realm of society.

6. Source: Giving Memphis 2008

7. Why important for fundraisers? Each individual is unique and therefore it is important for fundraisers to spend time listening to donors and finding out why they feel motivated to support any cause.

8. The Seven Faces of Philanthropy: A New Approach to Cultivating Major Donors 1. The Communitarian: Doing Good Makes Sense2. The Devout: Doing Good is God’s Will3. The Investor: Doing Good is Good Business4. The Socialite: Doing Good is Fun5. The Altruist: Doing Good Feels Right6. The Repayer: Doing Good in Return7. The Dynast: Doing Good is a Family Tradition Russ Alan Prince and Karen Maru File (2001) Jossey-Bass Pfeiffer

9. Theories for Fundraising Systems theory Organization does not exist in isolation, but is part of larger social, economic and political systems that affect and are affected by the organization’s behavior For fundraising – successful fundraisers must be aware of the environment

10. Social Exchange Theory Rather than an economic exchange ($$ for goods) donations create social exchanges – financial support for intangibles like prestige, self-esteem, recognition, etc. Based on the principles of interpersonal social behavior

11. Two Components of Social Exchange Grants economics - a spectrum of gifts from gifts of coercion to gifts of benevolence. Reciprocity – exchange of activity that is rewarding and costly Voluntary Unspecified obligations

12. Benefits of Social Exchange Extrinsic Intrinsic Mutual

13. What social exchange theory means to fundraisers Success depends on maintaining and nurturing interpersonal social relationships Depends on organization’s ability to serve its various publics ***While social exchange can be used in a manipulative way, fundraisers should not partake in manipulative activities.

14. Warm Glow Giving Motivated by “warm glow” or the happiness gained from having given an amount to the public good Egoistic Altruistic Fundraisers provides these opportunities.

15. Prestige & Signaling Intrinsic effect – how people care about the public good their donations underwrite Prestige effect – the value of the recognition Ex: Donor Lists No Amounts List Amounts By Categories

16. Coorientation Model Relationship between two individuals (donor and fundraiser) and some object of communication (fundraising opportunity) If two individuals have positive relationship, donor will either be more likely to consider the opportunity or less likely to continue the relationship

17. Persuasion Theory Reciprocity Scarcity – uncovering and describing the organization’s uncommon or unique features that cannot be found elsewhere Matching gifts Campaigns/naming Credibility Consistency

18. Philanthropic Psychology Social information about the amount of another donor’s contribution influences the level of a target donor’s giving Larger previous gift leads to larger gifts Ideal gift to refer to – 90 – 95 percentile Gifts larger when identify with previous donor, by gender or by role in organization Results in more disciplined approach to fundraising and the creation of more meaningful and satisfying philanthropic relationships for donors.