Tipping joins hand with technology to dig hole in our pocket

By | February 3, 2015


tipping



Anyone would know, tipping is a common practice in the restaurants throughout the world. It depends on various factors like services offered, politeness of the staff, cost of the meal, customer’s preferences etc.



Tipping between 15% to 20% of the total cost of the meal is the standard practice for a good service. With new technology and gadgets, a customer need not break his head calculating for there are buttons showing 10% 15% or even 20% to calculate the tip as when the bill is paid.

Restaurant-Tip1

But recent studies show that such devices make the customers tip generously to the waiters unintentionally. The New York Times have pointed out that services like Square that allows smaller vendors to use credit cards via mobile phones, have pre-set tips. $1 or $2 dollars more would not be a lot for a meal but for a cup of coffee $2 to $3 would be almost 75% of the coffee’s value.

Though there is a ‘no tip’ option, customers feel its awkward to click in front of the judgmental gaze of the cashier. But there are few customers (around 29%) are happy with the no-tip option for they are more likely to tip had there been no such option.

The launch of iPad P.O.S systems has brought about a lot of changes in the ways consumers tip, says Justin Guinn, a retail market research associate at Software Advice. It seems to pull in great money from the customers without their knowledge using the smart tipping feature where the customer may end up pay $2 for a $3 coffee. This smart feature is capable of adjusting the tip based on the total figure.

The tipping options for payment through credit card in cabs in New York City is even more clever. The cab has screens with the options of 20%, 25% and 30% tips for credit card payers, but when the customer intends to pay their own amount for tip it require another screen, more options, more buttons and more hassle. This would thereby push the clients to click the existing buttons and get finished with the tips paying part.

Apart from the devices to pay their tips while paying the bills,  there are gadgets to solely pay the tips. DipJar is such an electronic tip machine that allows people to swipe their credit cards into the device by the register and enter the amount they choose to tip. This doesn’t excuse customers when they have no change. The company is looking forward to install it at more than 500 locations very soon.



tipping

DipJar device

Another company ChangeTip seeks to make the tipping practice more wide and global. It serves as a platform to permit people to send Bitcoin payments through social media, email, Skype or even by text to anyone anywhere.

Founder and chief executive of the Silicon Valley start-up, Nick Sullivan, told NYT that most transactions are small but its ease and comfort ability of the service could lead to viral tipping practice. Tips through ChangeTip is public so when shared over social media, it would allow your friends and followers to see it. This publicity is where the potential for going viral grows.

These changes in technology and behavior can be significant for businesses and their employees, but it means a lot for our bottom line, too. Tips can add up and take a bite out of your budget, and that’s fine if you’re keeping track of things. If you’re not, however, you might find yourself living beyond your means.