Social and Market Relationships: 3 Easy Steps to Destruction
Last week I talked about the virtues of a retail-unattractive event. The gist of it is that a retail-unattractive event will only attract the mission-connected, and not a consumer who wants the experience you are offering. A walk is retail-unattractive, meaning no one is buying it on the open market. A marathon is retail-attractive, meaning it is bought and sold with success on the open market.
Otis Fulton, Turnkey’s in-house psychologist, notes that a retail-unattractive event fosters social relationships. A retail-attractive event fosters market relationships. While both retail-unattractive and retail-attractive events and social and market relationships can produce fundraising income at varying degrees of expense percentage, you can actually really hurt your income and your relationships by mixing the two.
And, of course, Otis is always packing references. (I love that about him.) “Dan Ariely describes the peril of ‘turning a social relationship into a market relationship’ in his well-known book 'Predictably Irrational',” said Otis. “Ariely explains that we live in two worlds: one characterized by social exchanges and the other characterized by market exchanges.
“We apply different norms to these two kinds of relationships. Moreover, introducing market norms into social exchanges violates the social norms and hurts the relationships. Once this type of mistake has been committed, recovering a social relationship is very difficult. As an example, Ariely says, ‘once you've offered to pay for the delightful Thanksgiving dinner, your mother-in-law will remember the incident for years to come.’”
The above situation happens in peer-to-peer fundraising events regularly. Even as we try and build a social relationship, some might call it a non-transactional relationship—we throw our targets curveballs in the form of market, or transactional, offers.
- “Fight breast cancer! Register by Tuesday at a discount!” Can you be a dyed-in-the-wool breast cancer warrior and still want the discount? No. You just convinced me that I am a consumer in a market relationship with you.
- “Raise $2,500 ... or we’ll charge your credit card the balance you haven’t raised.” I get it … seems like the business model demands it, but the human brain translates that into a purchase. And once I buy something, I am in a market relationship.
- “Two airline tickets if you raise $2,000!” Not only did we go transactional and destroy our social relationship, we did it in the most difficult to use form of cash–the airline voucher—which guarantees a truly hellish experience when one tries to use it. After they try and use the voucher, we’ll have a market relationship with someone who distrusts us.
We’ve all done the above or similar, typically when we are panicked about low registration numbers or low fundraising numbers. While we may see immediate response, it is like trying to entice your picky kid to eat by offering candy. Short term, effective; long term, poor outcome. It is, in the end, about tickling the target’s mission fancy.
Katrina VanHuss is the CEO of Turnkey, a U.S.-based strategy and execution firm for nonprofit fundraising campaigns. Katrina has been instilling passion in volunteer fundraisers since 1989 when she founded the company. Turnkey’s clients include most of the top thirty U.S. peer-to-peer campaigns — Susan G. Komen, the Cystic Fibrosis Foundation, the ALS Association, the Leukemia & Lymphoma Society, as well as some international organizations, like UNICEF.
Otis Fulton is a psychologist who joined Turnkey in 2013 as its consumer behavior expert. He works with clients to apply psychological principles to fundraising. He is a much-sought-after copywriter for nonprofit messaging. He has written campaigns for St. Jude’s Children’s Research Hospital, The March of Dimes, the USO and dozens of other organizations.
Now as a married couple, Katrina and Otis almost never stop talking about fundraising, volunteerism, and human decision-making – much to the chagrin of most dinner companions.
Katrina and Otis present regularly at clients’ national conferences, as well as at BBCon, NonProfit Pro P2P, Peer to Peer Forum, and others. They write a weekly column for NonProfit PRO and are the co-authors of the 2017 book, "Dollar Dash: The Behavioral Economics of Peer-to-Peer Fundraising." They live in Richmond, Virginia, USA.