Discounted Giving: How Price Discounts in Charitable Appeals Affect Prosocial Donor Contributions

ABSTRACT This research investigates the interactive effect of price discounts and prosocial identity on charitable contributions. Across three experiments ( N = 810), we examine how price discount tactics that temporarily lower the cost of helping influence individuals' charitable contributions. We demonstrate that price discounts reduce charitable contributions, particularly among individuals with high prosocial identity. Our results further show that this reduction is driven by diminished trust in the charity, stemming from negatively impacted perceptions of its sincerity and transparency. However, when price discounts were accompanied by clear information on how donations would be used and the necessity of the promotion, individuals with high prosocial identity did not respond negatively. These findings provide practical insights for nonprofits considering the use of marketplace promotional tools in their fundraising efforts, highlighting potential challenges and offering strategies to mitigate backlash while maintaining donor trust and engagement.