Pizza chains all over the world are placing their bets on the generosity of their customers, and one particular pizza chain is leading the way as the top-seller in the industry.
Domino’s has made a generous commitment to St. Jude Children’s Research Hospital, vowing to donate $174 million over the next decade. This substantial contribution will be funded through the pizza chain’s ongoing roundup campaign, which encourages customers to donate the difference between their purchase total and the next-highest dollar amount. Remarkably, Domino’s has already raised over $126 million for ALSAC, the hospital’s fundraising organization, through this initiative over the past twenty years.
According to Engage for Good, Domino’s has emerged as the latest and most prominent example of a successful “checkout charity” initiative. In 2022, the fundraising tool generated 24% more funds compared to 2020, making it one of the highest-grossing programs with a total contribution of $749 million.
Franchises are optimistic that consumers will continue to contribute their spare change, even in the face of online shopping trends, economic challenges, and concerns about donor fatigue. At the same time, retailers are deepening their partnerships, which were initially established in response to the heightened focus on corporate responsibility following the racial reckoning of 2020.
Why it works
According to a study published in the Journal of Consumer Psychology, research indicates that when it comes to requesting contributions from customers, asking them to round up their payment is generally more successful than asking for a fixed amount, even if the total amount remains the same. The reason behind this is that the act of rounding up reduces the perceived impact of spending money, making it a more favorable option for customers.
According to the research team led by Katie Kelting, a marketing professor at Saint Louis University, individuals reported feeling less pain.
According to Ike Silver, a marketing professor at Northwestern University, the timing of the appeal incorporates several psychologically impactful factors. For instance, buyers typically envision their purchases as whole numbers, so a bill of $24.75 is often rounded up to $25.
Furthermore, Silver pointed out that this approach to giving makes it “a bit more mindless.” When shoppers are in a rush to complete their purchases at the checkout line, they don’t have much time to think about reasons why they shouldn’t make a donation.
According to Silver, companies take advantage of a phenomenon known as purchase inertia, where consumers spend money without giving it much thought.
Helping PetSmart help animals
Advocates of this approach praise it for actively involving ordinary individuals who have the desire to contribute but may not have the means to give large amounts. This method of giving has become so popular that the collective donations from shoppers have become a significant source of funding for certain causes.
PetSmart Charities is known as the largest grantmaker for animal welfare causes, with over 80% of its cash donations being made through the PIN pad at checkout. For the past 20 years, the pet superstore has been running its ongoing PIN pad donation program, where customers are invited to contribute a fixed dollar amount starting at $2.
The funds aid causes that are directly linked to pets, including improving access to veterinary care and providing animal evacuation services during natural disasters. This genuine connection is one of the factors that lead PetSmart Charities President, Aimee Gilbreath, to state that their average donation amounts to just under $3. They estimate that by the end of this year, they will have contributed a total of $40 million.
Getting customers to donate would be slightly more challenging if our missions were not closely aligned, according to Gilbreath.
According to the speaker, it is much simpler for individuals to agree when they receive a message like, “I’m currently shopping at PetSmart. As someone who loves pets, I believe that donating to PetSmart Charities will help support pets in need of a loving family and provide assistance to pets in various other ways.”
According to Kelting, the alignment between the charity and the seller is significant. Researchers have found that customers might see point-of-sale solicitations as a breach of their social contract with a company. However, partnerships between organizations that share similar values are generally perceived in a more favorable way.
Donations follow connection at REI
In 2021, REI Co-op, a specialty retailer of outdoor clothing and equipment, introduced its member-supported public charity. The aim was to foster inclusivity in outdoor spaces and provide additional support to communities in the aftermath of COVID-19 shutdowns.
Sales associates at REI’s 185 U.S. locations frequently engage in personal conversations with customers about their upcoming outdoor adventures. These meaningful interactions with nature enthusiasts provide an opportunity for donation requests at the checkout, explains Squire Simpson, a board member at the REI Cooperative Action Fund.
REI cashiers leave the conversation open-ended, allowing customers to decide whether they want to round up or donate an amount of their choice. In 2022, stores raised approximately $2.2 million from 1.3 million individual donations, marking a 2.5% increase compared to the previous year.
Among the grantees are a Pennsylvania organization dedicated to promoting biking among Black women and an Alaska nonprofit that offers therapeutic recreation opportunities for individuals with disabilities.
Simpson emphasized that the recipient is not a generic corporate entity.
‘Checkout charity’ fa
tigue?
Some observers express concern that the increasing popularity of “checkout charity” programs may diminish their effectiveness, despite the good intentions behind them. Silver, a professor at Northwestern University, raises doubts about whether these programs can maintain their impact as similar initiatives emerge in checkout lines across the country.
According to the expert, if customers constantly encounter the same message every time they make a purchase, there is a risk that they will start to feel manipulated and become more aware of the tactics being used.
According to tax policy experts, it is important to note that stores cannot write off customers’ point-of-sale donations as company income, despite what popular internet memes may suggest. Misinformation on this matter only serves to confuse and mislead individuals.
Domino’s leaders have full confidence in their well-crafted strategy. By featuring the beloved St. Jude child on their pizza boxes, these esteemed partners have solidified their position as one of the most recognizable brands in terms of point-of-sale donations.
Above the checkout widget, you will find a compelling call-to-action accompanied by an image of a child. As part of their 11-week end-of-the-year campaign, St. Jude’s warmly invites customers to contribute through a convenient “click and go” pop-up. The options range from $2, $5, $10, to $20, allowing individuals to choose their desired donation amount. This thoughtful request provides an insight into the impactful work of St. Jude’s and showcases a tracker that displays the overall donation progress.
Last year, Domino’s managed to generate an impressive $8.9 million through its roundup initiative. The leadership at Domino’s is confident that this number will continue to rise as they implement a new five-year strategy aimed at expanding their customer base.
According to CEO Russell Weiner, the high-dollar charitable commitment is described as “an audacious goal” that may not be a guaranteed success. This adds another level of motivation to meet the organization’s latest nonprofit benchmarks.
