Charitable donation solicitations presented to shoppers during retail checkout processes are a popular fundraising mechanism, having contributed hundreds of millions of dollars to various causes. However, newly published research from the University of Adelaide Business School indicates that these requests, frequently made at the conclusion of the shopping transaction, can induce unpleasant feelings among customers and may even damage retailer reputations and sales volumes.
The study appearing in the Journal of Retailing and Consumer Services explores how the timing and method of these donation appeals influence shopper emotions and behavior. As shoppers approach the payment stage, they often encounter prompts to donate to charitable organizations. This moment, situated at the end of the checkout, creates a scenario where shoppers feel hurried since patrons are waiting behind them in the queue. The researchers identified that this situation can trigger a perception of time scarcity and pressure, exacerbating feelings of anxiety and discomfort.
As a result, some shoppers perceive the donation requests as intrusive interruptions during a process they want to expedite. The study outlines potential consequences of this dynamic, which include reduced overall satisfaction with the shopping experience, diminished intention to make purchases, and negative evaluations of the retailer brand. Thus, while charitable checkout campaigns substantially benefit fundraising efforts, these campaigns may unintentionally inflict damage on retailers' customer relationships.
Substantial Charitable Impact
Checkout charity campaigns have amassed impressive contributions for nonprofit organizations. In the first half of 2024 alone, 92 checkout donation initiatives collectively raised over $275 million. A notable example is Domino's Pizza (NASDAQ: DPZ), which has facilitated upwards of $126 million in donations to St. Jude Children’s Research Hospital during the past 20 years. The company projects an additional $174 million in donations over the ensuing decade.
Traditionally, charitable giving is linked to a "warm glow" effect, where donors experience positive emotions associated with their generosity. However, the study points out a paradox experienced by many shoppers: despite the societal benefits, they report feeling "doing good but feeling bad." This paradox arises mainly because the limited time imparted to decide on donating induces anxiety and stress.
Moreover, the research highlights a prevalent skepticism among customers regarding the transparency of where their donations ultimately go. Uncertainty about the allocation and impact of contributions can further discourage a pleasant donation experience.
Recommendations for Retailers
To alleviate the negative emotions linked with checkout donations, the study advocates that retailers rethink how and when they engage shoppers with these requests. One strategy to reduce perceived time pressure involves informing customers about ongoing charity campaigns earlier in the shopping journey rather than springing such requests at the very end.
In addition, employing digital interfaces, such as tablets or screens, for donation solicitation instead of verbal appeals at the register may reduce customer discomfort. Such technology can allow for a less intrusive interaction, potentially lowering the immediacy pressure shoppers feel.
From a communication standpoint, fostering the aforementioned "warm glow" requires emotionally engaging and relatable storytelling around the charitable cause. Equally important is enhancing transparency about how donations are used and the outcomes achieved. The study notes that only 44% of brands actively share fundraising results with their customers, indicating considerable room for improvement in this area.
Conclusion
While checkout-based donation campaigns generate significant philanthropic resources for numerous organizations, they simultaneously risk alienating consumers through anxiety and rushed decision-making. Retailers need to implement thoughtful strategies to balance the positive social impact with maintaining high levels of customer satisfaction and brand loyalty. Accordingly, earlier communication, less intrusive solicitation methods, and improved transparency could mitigate the adverse effects detailed by this research.