Rounding up for a cause : the joint effect of donation type and crowding on donation likelihood

Abstract

Prior research demonstrates that consumers are more likely to donate when asked to round up their total bill to the next whole dollar (vs. donate a flat-dollar amount). However, there is scant research demonstrating boundary conditions for the effectiveness of round-up donations. The purpose of this study is to fill this knowledge gap by suggesting crowding level of a service establishment as a boundary condition. Study 1 demonstrates that round-up (vs. flat-dollar) donations decrease perceived pain of donation, thereby increasing donation likelihood. Study 2 shows that round-up (vs. flat-dollar) donations decrease pain of donation in a crowded environment. Conversely, such differences in pain of donation are not observed in a non-crowded environment. The present study contributes to the nascent literature on round-up donations and provides insight to cause-related marketing managers concerning how to design donation messages.