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Amanda Kramer: Every episode, we have an LBIdea or a key takeaway. And the key takeaway here is that it's important to know your stakeholders and to be intentional in working with them.Ìý

Welcome to the Leeds Business Insights Podcast, featuring expert analysis to help you stand out from the herd. I'm your host, Amanda Kramer. We are thrilled to be discussing crowdfunding and volunteer mobilization with Gloria Urrea, assistant professor at the Leeds School of Business.

Welcome to Leeds Business Insights, Gloria, and thank you so much for being here today.

Gloria Urrea: Thank you, Amanda, for having me. I'm excited to be here.

Kramer: We are looking forward to the conversation. So, today, we're going to talk about two areas of your research: crowdfunding and volunteer mobilization. Let's start with crowdfunding. You study the ways in which humanitarian organizations utilize crowdfunding for emergency support. What are some of your key findings from the study about crowdfunding for emergency response?Ìý

Urrea: Sure. So, in this study, we basically study crowdfunding campaigns for charitable giving for emergency response, and we look at the role of transparency in those crowdfunding campaigns. So, actually, in this work, we look at two types of transparency that we called conventional transparency and operational transparency. So, let me explain those.Ìý

So, conventional transparency is basically being certified by the IRS as a charity. So, you can ensure donors, "I am a tax-exempt organization," right? And the operational transparency refers to simple actions that these campaigns organizers can take on the platform of actually writing updates to share their work, the work that they have achieved so far, with donors and with the general public.

So, it's interesting here to, kind of, take a second to understand what implies these two types of transparency. Conventional transparency actually takes a lot of time and effort. You need to file out all of paperwork. You need to be in communication with the IRS. You need to prove that what you are doing is good, right? Operational transparency is, basically, you are sitting, like, in a laptop and just taking pictures and writing about the work that you are doing.

So, when we look at how these two types of transparency differ, we expected initially that conventional transparency would send a stronger signal to donors to donate more to campaigns that are actually certified from a certified charity.Ìý

What we find, basically, about the role or, like, the effect of this transparency on donations on how much people were giving is that, we find that both types of transparency increase donations, which is good, right? Like, people value transparency. But what was striking for that... for us was to see that it was the operational transparency that had a stronger effect on donors. So, people were really, really interested in knowing the work, what is actually done with the money that they are giving, right?

And we went a step further to understand why that happened. And what we find is that, when they read these updates about the work that has been done, people feel... increase their perceptions of effort and trust towards the charity or towards the campaign organizer. And therefore, they are willing to give more money to them. That's basically, kind of, what happens behind the scenes.Ìý

Kramer: So, speaking of donors, what have you learned in your research, Gloria, about mobilizing donors without burning them out?

Urrea: Yes, building on this work about crowdfunding, but also on other papers that I have been working on, I can tell you that it is possible to achieve that, but it's a lot about managing the relationship with donors.Ìý

And I would emphasize two aspects here that are, again, informed by my own research. One is communication, and the second one is about getting to know your donors. So, about communication, so, this previous research that I just talk about is a perfect sample. Donors, in general, want to feel that they have an impact, right? So, they want to know that they are changing lives, right? That their money is worth huge. So, keeping them informed about what you have been doing with that money is very important. Crowdfunding is a great channel for that because it feels a lot like one-on-one. It's like you can post a picture there, which is more different when you just go and donate to a general website and you can only see, you know, the annual report, right? It feels very disconnected from the money that you are giving.Ìý

Crowdfunding actually allows you to, kind of, see you are supporting a specific project, and you can see the outcomes of those projects, how that is impacting lives, specifically. So, it really, kind of, closes the gap between, like, the donor and the beneficiary. You can really see what's going on, you know, if you use those updates for that.Ìý

The second aspect that I mentioned is, like, getting to know your donors, right? And here, we can think basically that charities have two types of donors. We can think about, like, new donors and more recurrent donors, existing donors. So, for new donors, for example, what I have learned from my research is that, for new donors, charities should offer them a full flexibility to, kind of, allocate their donations to what they think is important.Ìý

For example, the American Red Cross, when you enter to American Red Cross, they have, typically, like, a list of different projects that they are working on. So, you can donate to a specific disaster or you can donate to your local Red Cross. You can donate to a general fund for whatever is needed the most, right? So, giving that flexibility to donors, donors appreciate that, especially, again, if they're new donors and you don't know them.Ìý

For existing donors, basically, here is applying of, like, getting to know your donors, like, you... if you have a little bit of information about them, try to respect their preferences. So, some donors, let's say, really like to donate only to disasters. So, offer them that more prominently. Or, donors, like, maybe donate to a general fund for whatever is needed most, don't try to, like, push too strong on another type of thing, because they don't appreciate that they feel, kind of, forced to donate to something that it is not their preference. So that's, kind of, how to, maybe, keep them incentivized on, like, motivated to donate without burning them out.Ìý

Kramer: Yes, absolutely. Some great tips in there about mobilizing donors. To sum up this section, before we move on, I want to ask you, what are some actionable takeaways, either that you've covered or have not covered yet, for managers of crowdfunding campaigns and other campaign organizers?

Urrea: Sure. So, everything is, again, around transparency, right? So, like, recognizing how important it is for donors to know what is going on, right? So, in general, company organizers... and, hey, this could be company organizers for these nonprofit causes, but I'm pretty sure that it would translate for other types of crowdfunding campaigns. Using these updates to inform donors, it is very important. We... actually, it's something that I didn't mention before is that we actually found that, even a "thank you" note as an update has an effect. It's better than having no update at all. Maybe, donors feel that, like, it is not only about being appreciated, but, like, they know there is someone else at the other side of that platform, right? But what we see, really, from our research is, like, if campaign organizers really focus on the operational updates, so, in these updates that are actually sharing the work that they are doing, that is even more powerful.

So, if you are a campaign organizer but you are a certified charity, well, you know that by posting these operational updates, you're going to have a premium in the donations that you get, because, like, that is the more powerful case, the case in which you are certified and you are posting these operational updates.Ìý

Kramer: Yes, absolutely. It seems very transferrable. I'm thinking even about an entrepreneur that's trying to start their business in crowdfund, and they might not have the certifications, but what they do have is an opportunity to shed light on what's taking place and to be transparent about what's going on as they're working to start their business. So, it's really interesting.

Urrea: Yeah, that's exactly it. I think that, also, as a consumer now, not really a donor, but, like, as a consumer, I really appreciate when businesses are transparent with me for the good and the bad, right? If it is in a startup, I really want to know, you know, what are your objectives? Where do you see yourself, right? Like, being transparent from that first point, like, what is your timeline? What is the milestone that you're planning to achieve? And if you're an established business, it's like, okay, what is going on? There is also a lot of research showing that even revealing some sensitive information to an extent, like, costs also incentivize people, really make customers feel like more valued by the companies. And they appreciate that with more loyalty or, like, purchasing more. So, really, I think that one key takeaway for businesses, in general, and for people is, like, the power of transparency.

Kramer: Absolutely, the power of transparency. It's a great way to end that section, as we switch gears into volunteer management and mobilization. So, for nonprofits, volunteers are an essential part of their business model. What have you learned about managing volunteers to increase productivity and retention?Ìý

Urrea: Yes. So, I have done, kind of, different projects on volunteer management. And I have studied volunteer management, both offline settings and in online settings. Something that I have learned in both settings is the importance of accounting for volunteers' experience. And this, kind of, goes back to my point of getting to know your donors, right? So, when we think about volunteer management, we are thinking about people that are donating their time. So, it's also important to recognize their heterogeneity, how they are different, and how they may have different priorities of how I can, maybe, offer them different tasks depending on who they are.Ìý

So, in offline volunteering, this was a project that we did with a nonprofit here in the U.S. So, there were people that were going there to donate their time by building kits. So, it was like a food bank. So, something that is very relevant in this offline setting of volunteer management is that, typically, volunteers work in teams.

So, we were wondering what was the best mix of experience for these teams to work. So, what we find is that, under normal circumstances — and when I refer to normal circumstances, it's basically non-disaster ones — we see that collaboration, meaning I pair an experienced volunteer with an inexperienced one, is great, is the best. As you can, kind of, imagine that incentivizes collaboration, it brings mentoring in, and it allows the inexperienced volunteers to learn more as it is working through these orders.Ìý

What we find, however, that was a bit striking for us was that, under disaster-like situations, in which, let's say here, I'm referring to an increase in the orders, so there are many, many, many people that need food, and an increase in the volunteers, you know, like, everyone wants to help. So, when you have that surge of people both needing help and, like, wanting to help, that strategy of collaboration and mixing experience is not really the best.Ìý

At that point, what you really need is to speed up productivity. So, in order to speed up productivity, like, there should be some redistribution of tasks. So, for example, here, you would let the experienced volunteers do the more complex tasks, let's say, of picking up. So, you would pair an experienced with a non-experienced and, maybe, let the inexperienced volunteer do other supportive tasks, maybe put away the boxes, bring the new products, right, but not really interfering with the main tasks because it may slow down the process, which cannot be slowed down at that point, that is so critical. So, it's, kind of, understanding what works well under different situations.

Kramer: Now that we've covered offline volunteering, what about online volunteering?

Urrea: Now, from the online volunteering perspective, just to give a little bit of background, we started studying this online setting because we thought that it could be a very powerful channel for charities, in general, given that the online volunteering setting allows charities to recruit a higher number of volunteers because it basically removes all the time and space constraints. You can be volunteering from anywhere at any time. It became very, very important, especially during the pandemic. And I think it has stuck around a little bit as well.

So, what we study here in this project, we study an online volunteering platform that focuses on mapping tasks, that is putting on the map remote areas of the world, right, which is very, very important, especially when you have a disaster, let's say, unfortunately, now the earthquakes in Turkey, so that people know where people are, right? Like, organizations want to go and distribute aid. But where are the people? You know, like, Google Maps is great for the U.S., for Europe, but what about Africa and other more remote places? So, that's, kind of, the role of this volunteering platform.Ìý

So, that is one way to also, like, people basically log in and start mapping, like, identifying via satellite imagery where could be a house, where are buildings, where are roads, where are waterways? This is a bit different from other kind of volunteering tasks. It could be a bit more complex, like, designing a website or translating materials. But all of this is under the roof of online volunteering.

What is the role of experience in productivity and retention? Why do we care about these things? Well, productivity is important because that's how they get their projects done. And those projects are there, basically, to support the mission of the organization. So, you really want to support a charity, while they need to complete their project. So, that's why productivity is important.

Retention is also important because charities want to avoid losing knowledge and experience. Moreover, research has already shown that, when volunteers gain experience with a platform, they are more willing to take over more, maybe, monotonous task or other tasks that are needed to be done for the sustainability long-term of the platform but that more, like, newer volunteers wouldn't take on. These more experienced volunteers are really important to help to the long-term sustainability of the platform.Ìý

So, what do we find there? So, we find that there is one characteristic of the projects of this platform that incentivizes volunteer or incentivize the productivity of volunteers differently. And that characteristic is urgency. So, when you log into this platform, there are some urgent projects. Let's say, for example, right now, it could be the mapping some places in Turkey. That's, like, this is the earthquake we need to respond right now. So, this is, like, high-urgency project, versus, maybe, like, other projects that could be in preparation for future deployment, like, for example, mapping certain area of Africa for the distribution of malaria mosquito nets. So, these are, kind of, types of urgency.Ìý

What we find is that inexperienced volunteers are actually more productive for non-urgent projects; while more experienced volunteers are more productive for these urgent projects. Which, and I haven't thought about this, but it, kind of, aligns with the other previous ones. Like, more experienced is better for, like, disaster conditions, maybe. So, basically we see how productivity depends on who the volunteers are.Ìý

And regarding retention, there we find that... so, when you are a volunteer, you don't get paid, right? So, you need another type of incentive. Sometimes, that incentive comes in the, in the way of symbolic rewards. So, one of those symbolic rewards that we study here is the achievement of a rank. And this rank is based on experience. So, it's an experience-based rank. Basically, in this specific platform that we study, everyone that starts is a beginner. And then, as they gain experience, they can go up to intermediate, and then they can go up to advance. And we see that, every time people are closer to getting to those ranks, they are more involved with the platform, which basically increasing their retention. So, those are, kind of, two of the main findings that we have in that project.

Kramer: Yes. Thank you so much for that information, Gloria. So, we've talked about the nonprofit world, but there are some transferable lessons for for-profit businesses as well. Tell us more.Ìý

Urrea: Of course, Amanda. Like, the question about business is always there. Although, I like to take, like, a bigger perspective of the business world, right? For me, every time that I think about business is both the for-profit part and the nonprofit part. So, I want always to include a little bit the nonprofit sector as part of businesses.Ìý

So, I think that a key point from my research and from what we have discussed today is about transparency. So, for donors, we just discussed how important it is for them to know how their money is being used. And I think, for donors, it could be a special case, in the sense that there is a bit of information asymmetry, right? Like, you give money to a charity, and then the charity is the one that executes the project, or something with the beneficiary. So, there is, kind of, an intermediate there that is not so direct, which is not so much the case with customers, right? With customers, they are receiving a service directly from an organization, from a company. Donors are not receiving that service directly; someone else is receiving that service. So, the dynamics are a bit different, but both of them need to be surviving over time on, like, making sure their donors or their customers are happy.

So, transparency, I think, is a, is a great point that is applicable for all types of businesses. So, again, like, for nonprofit, it's important because it's about how they use their money; but also, for customers, they really value that businesses are transparent, even when that involves revealing some, let's say, sensitive information, like, about costs or their operational processes.Ìý

I think that another kind of transferrable piece, and I think businesses are much better about these already than nonprofits, is about getting to know your customer, right? So, I talked a lot about, today, getting to know your donor. And that is directly about getting to know your customer, right? So, what is... what do your customers care about? Or, what do they want to be informed about? It applies also, like, I want to give you a discount for this type of product. I know that you really like. But it's also about, like, maybe, what type of information your customer wants to know about the company.

Kramer: That's fantastic. Thank you, Gloria. Every episode, we have an LBIdea or a key takeaway. And the key takeaway here is that it's important to know your stakeholders and to be intentional in working with them.

Urrea: Thank you, Amanda. So, for example, in the case of donors and company platforms, they really care about impact. So, give them transparency. For volunteers, it's important to understand how the different levels of experience work. Well, try to adapt things for them, right? That will be, kind of, my main key takeaway. And it may apply, also, to personal aspects of our lives, but I will leave it like that.

Kramer: Okay, great. Thank you, Gloria, so much for joining us today.

Urrea: Thank you, Amanda, again for having me. And I hope this has been insightful for you and for our audience.

Kramer: Absolutely.Ìý

Thank you again for listening to Leeds Business Insights. Don't miss a single episode, subscribe to Leeds Business Insights wherever you get your podcasts. You can also find more information about our podcast series at leeds.ly/LBIpodcast.Ìý

If you've enjoyed this episode, you may also enjoy Creative Distillation, an entrepreneurship research podcast from the Leeds School of Business. Check it out at pod.link/creativedistillation.

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