Abstract
With charitable donations becoming a conventional norm, companies may choose to donate their products to improve public image and increase product visibility. Using two donation types (donation-for-gift/charity sale) and two product types (hedonic/utilitarian), this research discusses how charities should frame product-for-money activities toward enhancing compliance and re-donation intentions upon receiving product donations. Two 2 (donation types) by 2 (product types) between-subject experiments are conducted in college campus cafeterias. The first study uses an inspiring cause while the second study provides a scenario designed to evoke sympathy. Results show that donation-for-gift garners higher donation intentions compared to charity sale, as explained by the dual-process model. It is also revealed that product type moderates the influence of donation type on donation intention only when a sympathetic appeal is used. The fitting issue between product type and cause appeal, along with the licensing effect are presented to explain this finding.
4. Empirical implications and future studies
Which approach is better for conducting product-for-money causes? Using charitable giving as an incentive to sell products, or using gifts as an incentive in charitable fundraisings? The results from this research suggest that when charitable organizations receive product donations, fundraising procedures should focus on stimulating feelings of altruism, which means products should be given as gifts. It is more effective than directly exchanging the products for money — which then transforms social conscience into a mere bonus from a business transaction. This finding is critical to charitable organizations, as most conduct charity sales when trying to convert product donations into a more flexible resource. The current research also concludes how product types and cause appeal types can impact how donation types would affect donations. Specifically, when an inspiring appeal is used, donation-for-gift is more effective than charity sale no matter the type of products. On the other hand, under a sympathetic appeal scenario, donation-for-gift is more effective than charity sale when utilitarian products are offered. When hedonic goods are offered, however, there is no statistical difference between the two donation types. It implies that when charitable organizations receive product donations, giving the products as gifts is more likely to solicit more money than simply selling them. Charity sale is suitable for product-for-money events only when the offered products are hedonic and the cause appeal sympathetic.
