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 more than 200,000. The US (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.
And that competition is hurting them.
The downsides of competition
Research by University of Washington economist Bijetri Bose suggests greater competition among non-profits marginally increases aggregate donations but reduces average donations per organisation. Fundraising costs also escalate with greater competition.
There are concerns 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% survival rate for pancreatic cancer to 97% for testicular cancer and 85% for breast cancer. The campaign attracted attention, but not in the way the organisation 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 ten charities at a time.
In the US, 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.
As well as the issues already mentioned, competition generally disadvantages smaller charities.
The report’s focus was mostly on competition in bidding for government service contract. but its conclusions also apply to competition for public donations
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 co-operation possible?
Could charities compete less less and co-operation more?
Co-operative marketing structures are common in sectors such as agriculture. They are also used in retailing, where small independent stores, travel agents and newsagencies have pooled their marketing resources to compete with large corporate rivals.
Applying this approach would mean, for example, that cancer charities – breast, bowel, leukaemia, 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.
But there’s nothing like an idea whose time has come, and with passing year the case for charitable co-operation grows.
- ^ How to responsibly donate to Ukrainian causes (theconversation.com)
- ^ more than 200,000 (www.civilsociety.co.uk)
- ^ 1.5 million (nccs.urban.org)
- ^ Celebrity charities just compete with all other charities – so why start one? (theconversation.com)
- ^ about 40% do (fia.org.au)
- ^ reduces average donations (econ.washington.edu)
- ^ Charities are contributing to growing mistrust of mental-health text support — here's why (theconversation.com)
- ^ Pancreatic Cancer Action’s (pancreaticcanceraction.org)
- ^ in the way (www.theguardian.com)
- ^ CC BY (creativecommons.org)
- ^ 466 mailings from 99 charities (www.bbc.com)
- ^ ten charities at a time (www.fundraisingregulator.org.uk)
- ^ to half in 2018 (philanthropy.iupui.edu)
- ^ Does choice overload you? It depends on your personality – take the test (theconversation.com)
- ^ a 2020 report (www.civilsociety.co.uk)
- ^ ugly ones (www.smithsonianmag.com)
- ^ with diseases (eprints.gla.ac.uk)
- ^ pink steamroller (www.smh.com.au)
- ^ Olivia Newton-John (www.theguardian.com)
- ^ Olivia Newton-John Cancer Wellness & Research Centre (www.onjcancercentre.org)
- ^ CC BY (creativecommons.org)
- ^ McGrath Foundation (www.mcgrathfoundation.com.au)
- ^ Sydney Pink Test (www.pinktest.com.au)
- ^ The market is not our master — only state-led business cooperation will drive real economic recovery (theconversation.com)
- ^ talked about for years (www.charityconnect.co.uk)
Authors: David Waller, Associate Professor, University of Technology Sydney