Donor Giving Increases With Incentives That Appeal to Sense of Social Status

For the study, Sieg and co-author Jipeng Zhang of the University of Pittsburgh compiled a list of donors from 2004-2005 for 10 prominent nonprofits in the Pittsburgh metropolitan area, including the Ballet Theater, Children's Museum, City Theater, Pittsburgh Opera, Phipps Conservatory, Public Theater, Pittsburgh Symphony, Western Pennsylvania Conservancy, and Zoo and PPG Aquarium. The data was analyzed using a methodology never before employed in philanthropy research: one that classified individual tiers of giving as "prices" associated with different bundles of benefits.

Exclusive Benefits Have Big Impact
Sieg and Zhang also simulated the potential effects if the organizations were to change their donor benefit strategies. For example, adding one dinner party for donors in the highest tier of giving for the Carnegie Museum, the largest organization in the data sample, would raise an additional $197,425 annually. But the Children's Museum, a much smaller organization with a lower profile, would gain only about $11,019 from an additional donor event. According to the researchers, this variation underscores the power of a charity's status in the community as a central influencer of donor contributions.