East Bay Asian Local Development Corporation 35 years of
building healthy neighborhoods
Applying Behavioral EconomicsEBALDC & SparkPoint Oakland
Centers 2010 VITA Site
Presenter: Charise Fong November 18, 2010
FEN Behavioral Economics PanelFederal Reserve Bank of San
2 EBALDC is a community development corporation based in Oakland
serving diverse low and moderate income neighborhoods in the East
EBALDC operates the 3rd largest VITA site in Alameda County, and
is a member of the UWBA Earn It!Keep It!Save It! Campaign.
For the last 2 years, we have operated a satellite VITA site at
one of our housing developments - Lion Creek Crossings in East
Our Lion Creek Crossings satellite VITA site had very low uptake
(between 10-20 tax filers/yr)
EAST BAY ASIAN LOCAL DEVELOPMENT CORPORATION
Background about EBALDC and our VITA Program
3 EBALDC is one of the founding partners of the SparkPoint
Oakland Center (SPOC), a UWBA financial stability initiative.
SPOC opened its first offices at Lion Creek in 2009, and at the
time, it was not well known in the community.
EBALDC planned to run the Lion Creek VITA site at SPOC. We were
concerned that we might not draw many new
clients because SPOC was so new, and previous years the site had
SPARKPOINT OAKLAND CENTERBackground about VITA and SPOC at Lion
4Behavioral Economics helped EBALDC and SPOC create solutions to
increase client outreach and participation at our Lion Creek
Crossings/East Oakland site.
OPPORTUNITIES TO APPLY BEHAVIORAL ECONOMICS
Key Questions: How do we increase uptake of our VITA services
among both Lion Creek Crossings tenants and residents in the
surrounding neighborhood? How do we discourage the use of expensive
paid tax preparers and refund anticipation loans (RALs)?
Background about VITA and SPOC at Lion Creek Crossings
5 EBALDC worked with Amy Brown, Behavioral Economics expert from
the Aspen Institute.
We conducted focus groups to understand the target audience and
the factors that people considered important when seeking tax
preparation services (channel and hassle factors).
APPLYING BEHAVIORAL ECONOMICSFocus groups helped to identify
important factors to draw VITA clients
4 main factors influencing potential VITA clients:1) Convenience
(hours and location)2) Information security3) Tax law expertise 4)
Speed of service delivery (both tax preparation time and refund
waiting time)* Price turned out to be a minor issue
6Dont throw away 20 hours of pay Loss aversion
Is 7 days worth $200? Loss aversion
Comparison checklist Simplified choice, decision making
MARKETING MESSAGES Developing marketing messages using
7DONT THROW AWAY 20 HOURS OF PAYDeveloping marketing messages
using behavioral economics.
8IS 7 DAYS WORTH $200?Developing marketing messages using
9COMPARISON CHECKLISTDeveloping marketing messages using
CHECKLIST OF FACTORSDeveloping marketing messages using
More convenient days/hours (weekdays, weeknights, Saturdays)
Opened earlier in the season (mid-January) Appointment waiting
times no more than 30 min. Coffee, drinks and snacks while people
were waiting Friendly greeters helped people to fill out their
forms as soon as they arrived and talked to them about other
Games/activity books for kids while they wait.
CHANGES TO DESIGN OF VITA PROGRAMApplying Behavioral Economics
to service delivery
We wanted to encourage word of mouth referrals Clients were
asked to refer friends and family if they
liked our services (power of peer testimonials)
For each referral, a client received an entry in to a raffle
drawing (so each referral increased clients chances of winning a
RESULT: 31 clients referred 44 new people who also became
OUTREACH AMBASSADOR PROGRAMIncentivizing referrals from
SPOC had been struggling with getting people to come back after
initial screening for income supports
We tested the opt-out approach, asking people to fill out the
income supports worksheet as part of the VITA intake.
While clients were in their tax prep appointments, we calculated
clients income supports eligibility results.
At the end of their tax appointments, we asked clients to stay
and review their income supports eligibility results.
Most clients were willing to stay, and in some cases to also
meet with a financial counselor.
BUNDLING SERVICES WITH VITA
We exceeded our 2010 goal by 57%, serving 188 tax clients and
obtaining $300,349 in tax refunds
Among Lion Creek residents we had a 400% increase in
participation over the previous two years.
2010 VITA RESULTS FROM THE SPOC LION CREEK CROSSINGS SITE
How successful were the outreach methods?
Referrals from CBO's, media, and other sources
New Materials Using Behavioral Economics24%
Word of mouth referrals32%
The behavioral economics approach made us rethink how we market
and deliver services.
We wish we had tracked the effectiveness of each of the
different marketing approaches to better understand which factors
have greatest impact.
This coming tax season, we will incorporate more behavioral
economics to reach more people and encourage clients to enroll in
CFED & Ideas 42 can connect organizations to research
partners and technical assistance.
Charise FongDirector, Neighborhood and Economic
East Bay Asian Local Development Corporation
Oakland, CA510-287-5353, [email protected]
Slide Number 1EAST BAY ASIAN LOCAL DEVELOPMENT
CORPORATIONSPARKPOINT OAKLAND CENTEROPPORTUNITIES TO APPLY
BEHAVIORAL ECONOMICSAPPLYING BEHAVIORAL ECONOMICSMARKETING MESSAGES
DONT THROW AWAY 20 HOURS OF PAYIS 7 DAYS WORTH $200?COMPARISON
CHECKLISTCHECKLIST OF FACTORSCHANGES TO DESIGN OF VITA
PROGRAMOUTREACH AMBASSADOR PROGRAMBUNDLING SERVICES WITH VITA2010
VITA RESULTS FROM THE SPOC LION CREEK CROSSINGS SITEFINAL