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Does new-tech tipping trick you into paying more?




A till receipt is displayed on a bar on January 12, 2012 in Rome.
A till receipt is displayed on a bar on January 12, 2012 in Rome.
GABRIEL BOUYS/AFP/Getty Images

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Small businesses and restaurants are embracing apps that allow for easy tipping. You may already have used one — an iPad or phone plug-in that allows you to swipe your card and then asks how much you’d like to tip. By default, the choices are 15, 20, and 25 percent, with options for a custom tip, or, if you’d like to feel incredibly guilty, no tip.

Tipping is contentious enough without technology, customers have to decide whether they want to tip before or after tax, whether to include drinks, how much to tip on take-out, at-the-counter orders, and more.

Apps like Square simplify the process, calculating percentages for you and making payment easier. But they also lead to more spending.

Tips go way up at businesses that use tipping apps — customers are more likely to pay up when a waiter or cashier swivels an iPad to let them add a tip. Is it guilt that business are cashing in on? Or ease? Is technology changing the culture of tipping?

Guests:

Rachel Levin, San Francisco based reporter and contributor to Pacific Standard Magazine

Michael McCall, Professor and Chair, Department of Marketing and Law at Ithaca College, visiting professor at Cornell University Hotel School