On a recent trip to New York, I was the subject of a nudge. Just like those described by Noble Prize winner Richard Thaler in his book Nudges. And I liked it.
But first, some background.
I have always felt servers in restaurants deserved more than a 15% tip. I think any service, from terrible to just acceptable, should warrant a minimum 15% tip. We should reward anything better than adequate with 20% or more.
So, as someone who knows a bit about barriers to behaviours, I have been disappointed in the options the electronic payment terminals offer when it is time to settle up the bill.
These terminals ask if you want to leave a tip. When you indicate yes, most offer three options: 10%, 15% or other. If you wish to tip 10 or 15 percent you just hit the appropriate button, and the system adds it to your bill for you to confirm. So convenient!
But if you want to tip more, like 20%, you have to hit “other”. The terminal presents you with another screen, where you must hit the 2 and 0 buttons, and then hit enter. Finally, the system asks you to confirm the amount you just entered. When you do, the system adds it to your bill.
If you are counting, that means you have to press one button to tip 10%. Or one button to hit 15%. Or push five buttons to tip 20%.
Four more buttons and two extra screens may not seem like a lot of extra work. But people who are not thinking much about the tip and the service, are likely to choose the smoothest path to tipping, which runs through the 10% or 15% options. We are all subject to the tyranny of convenience.
That means that it is likely that servers receive less money for their work than they might if there was a slight change to the programming of the payment terminal.
A recent study on tipping determined that 15% is the average tip for restaurant workers. In North America, restaurant staff rely on tips for the majority of their earnings.
Unless the restaurant is high-end, and most are not, the amount servers and kitchen workers take home is relatively small. A simple change to the options on the tip screen could increase their pay by as much as a third. At the same time, higher pay would benefit the restaurant by attracting and retaining workers, at no extra cost.
On a recent trip to New York, I noticed one of the restaurants had 15%, 20%, and other in the options. This