Last month I passed along Seth Godin's keen observations about the gift cards phenomenon.
He explained that money from gift card fees and breakage, unused by the recipients and going back to the retailers, came to $8 billion last year.
Godin pointed out the irony of how many of us view giving gift cards as proof we engaged in the thought that counts whereas cold hard cash, a better deal for giver and recipient, is somehow gauche. Godin neatly solved this mystery by reminding us of these twin truths:
(1) Human beings are not rational.
(2) No one ever lost a buck by telling a story that takes root in the consumers' minds strongly enough to supplant the facts.
He suggested that retailers or even entrepreneurial NPOs could tell a better story. The idea intrigued me. Taking Godin's cue, I suggested that NPOs could partner with retailers to take advantage of the gift card phenomenon and get some of that $8 billion flowing into their coffers rather than back to the retailers. But last week, Morning Edition reported how some NPOs are using charity gift card providers to go one step better, cut out the retail transaction middle man and put the kitten right under the cow.
TisBest was the charity gift card provider featured in the story. The concept is simple. To quote their website, "it works like any other gift card, except that instead of buying stuff in a store, the recipient spends it to support a charity of their choice." As Wendy Kauffman reported, "the 200 plus choices on TisBest.org range from Amnesty International and autism research to the Special Olympics and the YMCA." Some one at NPR was a bit sleepy on the full disclosure front, though, because the story failed to mention that NPR is also among the TisBest options.
While Pacifica Radio and PBS are options as well, no individual NPR or PBS member-stations—even of the large market variety—are listed on the site. Perhaps none have yet bothered to learn how to join in all the reindeer games, so to speak. Maybe they have and decided there are bigger fish to fry. Perhaps they found the price of admission prohibitive to testing, although I would imagine sweat equity (i.e. effort) is more of a factor than actual dollars.
I know of no stations, nor have I ever worked at or for one, that has been able to lift the "gift membership" offer high enough off the ground to make a real difference. But the charity gift card concept seems easier and, in a way that may at first seem counter-intuitive, more purely philanthropic.
What might make it seem less than appealing is that the card purchaser does not select the charity in question, but gives that option to the recipient. So an NPO could spend time and energy marketing the purchase of charity gift cards with no good way of being reasonably sure that the people getting the cards as gifts would use them to contribute to their organization. Any station participating on the TisBest site would put itself side by side with many worthwhile "competitors" for share of wallet.
In the NPR story, CharityNavigator's President Trent Stamp says that charity gift cards have "exploded in the last couple of years" and reporter Kauffman relays that Stamp believes this has "been driven by those wanting to make a charitable gift on behalf of family or friends but who didn't want to be so presumptuous as to chose the charity—a gift card solves the problem." That seems reasonable, but does it hold true for all of the gift giving that a site like TisBest could leverage to an NPO's advantage? After all, if I know you well enough to be sure you'd appreciate a gift card from Barnes and Noble more than one from Sephora, don't I also know you well enough to be sure you'd want a gift of support to go to Pacifica Radio instead of Amnesty International?
Today's post comes to no hard, fast conclusion. Please file this under "we report, you decide (to do something useful with the information if you feel like it.)". But starting to think about this idea now, engaging in some conversations in your shop and also doing a little research when time allows in the month's ahead might best position you to make the smartest move when the 2008 holiday season looms into view.
By the way, Justgive.org and CharityChoice, although they have slightly different business models, are also players in this arena.
Happy Holiday Shopping!
I am generally opposed to gimmicks in philanthropy, but I think that an exception is worth examining with charity gift cards. Why? Kids. My kids often receive gift cards and are very savvy about using them...down to the last dime. They're not about to leave any money on them unspent. At a time when so many foundations (Fidelity Charitable Gift Fund has announced five $15,000 grants to colleges that will establish charitable funds to be managed and dispersed by student-led groups, according to The Boston Globe.)and nonprofits are trying to find new ways to attract young people and to educate them about the values of philanthropy, maybe, just maybe, this concept is worth a try.
Lastly, I would appreciate a gift card over a tchotchke any day!
Great posting Mark!
Posted by: Robert Stein | 17 December 2007 at 07:54 PM