A 2006 study from The William Davidson Institute at the University of Michigan showed how media coverage of the 2004 tsunami influenced charitable donations. For their analysis, they had to isolate the effect media coverage had on donations, so they controlled for tax incentives, agency-specific effects, and “donor fatigue” (meaning that more exposure to an event caused people to be less willing to donate). What they found was that donations increased by 13.2 percent for the average relief agency after an additional minute of network news coverage. A single 700-word story in the “New York Times” or the “Wall Street Journal” increased donations by 18.2 percent.
Another factor that influenced giving after the tsunami was that both Google and Amazon added links to charities on their home pages, making it very convenient to donate. For example, the link on the Amazon website raised $2.5 million for the Red Cross in 24 hours.
In 2012, the American Red Cross raised more than $300 million to help Hurricane Sandy victims. Yet, despite their enormously successful fundraising campaign, critics have charged that the way they responded during and after the disaster was truly disappointing. After investigating claims that the Red Cross “diverted assets” to enhance their image in the wake of Hurricane Sandy, NPR and ProPublica reported that multiple internal documents and interviews with top Red Cross officials revealed that they “… struggled to meet the basic needs of victims in the first weeks after the storm. The documents and interviews also depict an organization so consumed with public relations that it hindered the charity's ability to provide disaster services.”
In its response to these stories, Red Cross officials pointed out several inaccuracies and refuted many of the claims as myths. The fallout can't be fully assessed at this point as the news coverage is ongoing. However, this isn't the first scandal to tarnish a charity as venerable as the Red Cross. The United Way and other organizations have dealt with the backlash caused by their misdeeds over the years as well. In many of these cases, the media served to protect the public from donating their funds to organizations that are not operating ethically.
At the time of Hurricane Katrina, I couldn't budget an actual donation of anything other than my time. And so I went to my local Red Cross headquarters and asked what I could do to help. I ended up in their office a few days a week entering donor information into their computer system. I'm saddened by this recent news about the Red Cross. When I first heard the news, my knee-jerk reaction was to think, “I'm not going to send any money to this organization again.” In my case, the media coverage was affecting my thought process about donating. But then, after a while, a surprising thought crept in — I began to think, “Well, maybe I should get involved again instead.”
The readers of GetRichSlowly are very interested in charitable giving — whether they give of their time or their hard-earned money. But what do you think? Has media coverage affected how you donate, and should it? Have you ever felt donor fatigue? Do you have a plan in place for how you make charitable donations, and does having a plan make you more or less affected by media coverage?