Would you rather buy a pair of shoes made by a for-profit business or a nonprofit organization? You probably prefer the for-profit one even though you don’t know anything about the business or the product.
This simple example illustrates the stereotypes people can have about nonprofit vs. for-profit organizations. Stereotypes are pre-existing beliefs and expectations that aren’t necessarily tied to individuals but are instead generalized to the bigger group to which individuals belong.
We usually think of stereotypes as applying to groups of people based on race, gender, etc., but stereotypes can also be applied to other, more abstract concepts. In this case, people have stereotypes about nonprofits—namely that they aren’t very competent, despite their good intentions. Whether or not these stereotypes are true They often aren’t, which makes their widespread use all the more troubling., the point is that they can bias people’s perceptions and decisions.
Warmth and Competence Stereotypes
According to a whole bunch of research, our judgments of people come down to two major perceptions: warmth and competence. Warmth judgments are things like generosity, trustworthiness, and sincerity. Competence judgments are things like intelligence, skillfulness, and confidence.
Many cultural stereotypes consist of a specific combination of warmth and competence perceptions. Take the elderly, for example. According to large scale survey testing, people’s stereotypes of the elderly are that they are warm but not competent (sometimes called “pitying prejudice”). On the other hand, the research has shown that people’s stereotypes of Jewish people are that they are competent but cold (sometimes called “envious prejudice”). Of course, though, it’s also possible for a group to be stereotyped as very warm and competent or very cold and incompetent.
The Warm-But-Incompetent Nonprofit Stereotype
This “warmth” and “competence” makes sense when we’re talking about people, but are the same two types of judgments important in other ways? Recent research by Jennifer Aaker, Kathleen Vohs, and Cassie Mogilner tested whether these same judgments matter for nonprofit vs. for-profit organizations.
The first step in this research was to see if a simple change led to corresponding changes in perceived warmth and competence. In an initial study, the researchers asked people to review a product description for a new messenger bag made by Mozilla, but they led them to believe that the bag was made by Mozilla, a for-profit organization or Mozilla, a nonprofit one.
They manipulated that perception with one tiny change: they told people the bag was available at mozilla.com or at mozilla.org. Other than that, everything was exactly the same. All that differed was whether people thought the organization was a for-profit business (.com) or as a nonprofit (.org). Indeed, when asked later, it was clear that the participants drew that conclusion from the URL provided.
After they reviewed the product description, everyone answered some questions about how they perceived Mozilla. They rated the organization on a whole bunch traits having to do with its warmth and competence.
The trait ratings revealed that people perceived mozilla.org to be warmer (e.g., kind and generous) than mozilla.com. You might expect this because presumably a nonprofit’s mission is more other-focused and generosity driven, but it was also true that people perceived mozilla.org to be less competent than mozilla.com. Just changing the URL for the company changed how the company was perceived.
Why it Matters: Do People Prefer to Buy from For-Profit Groups?
The implication of this perception bias is that people will think that products are better if they’re made by for-profit businesses, and they’ll be more likely to buy those products than if they were made by nonprofits.
To see if that was true, the researchers ran a second experiment using a new organization, “World of Good,” which they described as an eco-friendly online retailer. They showed everyone an eco-friendly laptop bag available from World of Good, but like the previous study, they either told people that it was available at WorldOfGood.com or WorldOfGood.org.
Like before, people rated the company as warmer and less competent if it was a dot-org instead of a dot-com. In this study, though, they also asked people how likely they’d be to buy the laptop bag. People were less inclined to buy the very same product when it was available from WorldOfGood.org than when it was available from WorldOfGood.com.
Getting Rid of the Incompetent Nonprofit Stereotype
So does this mean nonprofits are doomed by stereotypes of incompetence? Hopefully not! The study added a little wrinkle to see if there was any hope for reversing people’s stereotypes about nonprofit organizations.
Their idea was that nonprofits that are endorsed by credible sources will be seen as more competent. So in the World of Good study, the participants read that this organization had either been endorsed by the Detroit Free Press (a less credible source) Sorry, Detroit. This wasn’t my call. I’m just telling people what happened in the study. or by the Wall Street Journal (a highly credible source).
When people saw Detroit Free Press’ endorsement, the dot-org version of the company was seen as less competent than the dot-com version (just like we’ve already seen). However, when the Wall Street Journal endorsed the company, WorldOfGood.com and WorldOfGood.org were seen as equally competent. In fact, people were no more likely to buy the bag from a dot-com versus a dot-org website as long as the site was endorsed by a credible source.
A Warm Cup of Nonprofit Competence  I’ve re-read this headline a bunch of times, and I’m not convinced it makes any sense, but boy do I like it.
I think a key point to keep in mind with this research is that the available information about each product was exactly the same. There was no objective reason to think the product was better when it was connected to a for-profit organization versus a nonprofit one. Instead, it was just a preconceived notion about nonprofits that biased people’s perceptions.
Obviously this bias is disheartening because it means do-good nonprofit organizations are stuck with people’s belief that despite their lovely intentions, they are not able to competently do good work. Of course, there are plenty of nonprofits that defy this stereotype and yet, as long as that belief persists, the public’s biased perceptions and decisions will persist.
As Aaker and her colleagues showed, one way to push back against this bias is to get the endorsement of a credible source. But is there another way? Let us know your ideas in the comments.
Footnotes [ + ]
|1.||↑||They often aren’t, which makes their widespread use all the more troubling.|
|2.||↑||Sorry, Detroit. This wasn’t my call. I’m just telling people what happened in the study.|
|3.||↑||I’ve re-read this headline a bunch of times, and I’m not convinced it makes any sense, but boy do I like it.|