Radiohead just released an album. Yes, we’re all a-tingle and anytime Radiohead does anything, it’s a big deal. But what’s notable about this release is that it’s being posted on the internet for free download and fans pay what they want to pay. The theory goes like this: like it a lot = pay a lot, like it not = pay nothing. I haven’t heard the album, but I’m expecting them to do pretty well. What a cool place we’re at in time where products and services are paid for via donations. And that’s what this amounts to - some communist business model where you pay what you feel like paying. No hard sticker price, just your conscience guiding you. Lots of blogs are doing it these days. People put their time and energy into something and then put their faith into the world that there will be some form of gratitude.

This site too bases its business model (if you can call it that) largely on donations. I like the idea that everything is potentially free. There are ads too, which people can either look at or ignore - but, of course, that is another business model. To understand donations better, it’s a good idea to understand why people make donations. This can be largely explained by the phenomenon of altruism. Altruism exists in two forms: 1) reciprocal: i.e. “you owe me one” and 2) kin: “I win when you win”.

In reciprocal altruism, you do something for someone and they are obligated to do something back for you - whether this obligation is enforced by an iron-clad contract or a passive-aggressive guilt trip. This, of course, only works when both parties know of the other’s existence. Donations based on reciprocal altruism may not have such a bright future. With a donation, in this definition (via the internet and largely anonymous) recognition of the donating party is fairly vague. They gave you five bucks, you know their email address, but a feeling of reciprocity is not very strong. You assume they got something out of your product, site, or service and are simply showing their appreciation. A system is not in place which would make this true reciprocal altruism. They could have just as well not paid you five bucks. The end result in terms of your feelings towards them is practically the same when measured in terms of reciprocity. So, just expecting to post good stuff and get money for it from donators may not work out in the long term.

Kin altruism may be the saving grace. We know from evolution that altruism is stronger towards those sharing a higher percentage of our genes (i.e., you’ll be more altruistic to your siblings than to your cousins, statistically). We also know that beliefs and values, not genes, are the currency of cultural evolution. Therefore, by the same mechanism, altruism is stronger towards those who share a higher percentage of our beliefs. For instance, if two people were drowning and you could only save one, who would it be - the one who loved your favorite band or the one who hated your favorite band? Now substitute the word “band” with “religious figure” and you see how strong this stuff really is. Donations should theoretically come easier from those who share your beliefs and values. The more web visitors you attract who believe what you believe and the stronger they believe it, the more money you should theoretically make through donations. A lot of people like Radiohead and their fans are pretty fervent, so by this logic, I would expect Radiohead to do relatively well with this initiative.

How to increase donations
For altruism to really flourish, a few things need to be in place. It may be worth trying to work these elements into your website and/or business.
 - donor identification - altruism doesn’t work as well when the donors are anonymous. Get their names recognized somehow - preferably publicly. Everyone likes other people to know they gave something for nothing. I know what you’re thinking, “doesn’t that make it more of an ad than a donation?” Maybe a little, but in this sense they are both agreements (”I do something and you do something in return”)- just in slightly different forms.
 - do something a lot of people like and feel strongly about - this would explain why there is so much content related to religion, George Bush, and the war in Iraq. Virtually everyone feels strongly about these subjects.
- present a good, positive image for your business/website. Perhaps contrary to logic, people who have a lot of money will tend to receive more donations than those who have very little money. This is the reciprocal altruism again - you give to people who you expect will be able to help you in the future. Poor people would have a harder time doing this. Present yourself well and people will be more likely to give.
- convince people you are helping them - by doing whatever you’re doing in your business, point out the benefits the donator will be receiving (and they should certainly be receiving something beneficial). Radiohead can say that they are providing good music. You should accentuate the great content you’re enriching lives with.

Notice how these four things sound a lot like campaigning - and indeed you’ll see them all in bloom in the upcoming US election. Give them some thought for your website/organization. Hope it works out…. And in a no way ironic gesture…

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