Increasing Servers’ Tips

1. Increasing Servers’ Tips Ben Dewald The Collins College of Hospitality Management Cal Poly, Pomona

2. Introduction • Whether or not customers tip depends a lot on the service received, as well as whether or not they think they will be returning to the same establishment. • Sometimes guests leave tips simply because it is expected. • Believe it or not, a lot of research has gone into why restaurant patrons tip and what makes them tip more or less for similar service. Tipping is not always simply a sign of a job well done. • This presentation will reveal some interesting facts about server habits that can boost tip percentages.

3. Background • In theory customers reward good service with money (Schein et al. 84; Lynn et al. 93) But • Bill size prominent variable affecting tip (Lynn & Grassman 1990; Lynn, 1988; Freeman et al. 1975) • Servers tend to work for a 15 - 20% commission

4. The Global Perspective • People from around the world give voluntary sums of money, called tips, to service workers • Most service worker are tipped in America and Southern Europe • Hardly practiced in Asia & Down under

5. Attributes Affecting Tips Controllable & Uncontrollable • Related to service quality • Questionable service quality • Gender specific • Customer • Payment • Weather • Culture Specific

6. Related to Service Quality • Server smiling at guests(Tidd & Lockhard, 1978) • Making extra visits to the table(Fitzsimmons & Maurer, 1991) • Introducing oneself (Garrity & Degelman, 1990)

7. Server Smiling at Guests(Tidd & Lockhard, 1978) • Tested in a Seattle cocktail lounge • Randomly assigned half to receive • Large, open-mouth smile • Small, closed mouth smile • Small smile average tip of 20 cents • Big small average tip of 48 cents • Increase of 140% • Encourage your staff to flash big smiles

8. Server Introduction(Garrity & Degelman, 1990) • Good morning. My name is Kim & I’ll be serving you this morning. Have you ever been to Charlie Brown’s for brunch before? • Large effect on tip • $3.49 (15%) with no name • $5.44 (23%) with name • Earned $2 more • Suggest your staff to introduce themselves professionally

9. Service ? Better Tips • Casually touching guests(Lynn et al., 1998; Lynn, 1996; Hornik, 1992; Stephen & Zweigenhaft, 1986; Crusco & Wetsel, 1984). • Squatting at the table by servers resulted in larger tips (Lynn, 1996; Lynn & Mynier, 1993). • Credit-card insignia on tip trays increased tips even when paying cash (Feinberg, 1986; Lynn, 1996) • writing “Thank You” on checks also resulted in larger tips (Rind & Bordia, 1995). • Giving candies

10. Touching • Servers experienced a tip increase from 11.8% to 14.8% of the check total when they briefly touched the shoulder of the customer. • Both men and women left higher tips when touched, and although younger customers increased their tip amount more, all ages increased the tip by some amount.

11. Squatting • Two studies showed that serers who squatted next to the table when taking orders and talking with customers increased their tips from 14.9% of the bill to 17.5% of the bill in one study, and from 12% to 15% in another study. • Apparently, the eye contact and closer interaction creates a more intimate connection and makes us want to give the server more money.

12. Credit-Card Insignia on Tip Trays • Tested in 2 establishments • When presenting bill on a tip tray with a credit-card emblem • Tips increased from 16 to 20% in the restaurant • and from 18 to 22% in the café • Not due to increased credit card use all café customers paid in cash • Start using tip tray w/ credit-card emblems

13. Writing “Thank You” on Checks • Tested at upscale restaurant in Philadelphia • Randomly assigned lunch customers into 3 groups • On the back of the check she wrote • Nothing, thank you, thank you & name • Average tip 16-18% w/ Thank You • Encourage servers to write

14. Giving Candy • A study that involved giving customers a piece of candy with their bill showed an increase in tip percentage from 15.1% to 17.8%. Another study in which servers gave each customer two pieces of candy with the bill increased the tip from 19% to 21.6% of the bill. • Still another study showed that the way the server gave the customer the candy had the largest impact on the increase of the tip: This study had the server initially give each member of the customer's party one piece of candy and then "spontaneously" offer a second piece of candy. This method increased the tip to 23% of the bill!

15. Gender Specific • Waitress’s tips increased by drawing a happy face on checks but did the opposite for waiters(Lynn, 1996), • Flowers in a waitress’s hair increased her tips (Stillman & Hensley, 1980) and • Good looking waiters made more tips (Lynn & Latané, 1984; Lynn et al., 1993). • Male customers tipped more (Lynn & Bond, 1992; Crusco & Wetsel, 1984; Lynn & Latane, 1984; Stillman & Hensley, 1980).

16. Drawing on Checks • Some waitresses draw a “happy face” on the back of their checks. • Personalize serve to customer • Communicate to customer server is happy to have served them • Make customer smile themselves • Waitress 28-33%= +18% • Waiter 21-18%= -14%

17. Payment/Customer/Weather Specific Tips were higher: • Paying by credit card(Lynn & Mynier, 1993; Garrity & Dengelman, 1990; Lynn & Latané, 1984), • People that have been drinking(Lynn, 1988) • Regular guests(Lynn & Grassman, 1990). • on sunny days(Crusco & Wetzel, 1984: Cunningham, 1979).

18. Tips for earning More Tips • (Lynn 96)

19. Actions Not Additive • More research needed to be certain but • Likely that as tip goes up, so does resistance to further increases • Combining actions that separately increase tips will probably not produce an even larger effect. • Managers can maximize their servers’ incomes without encouraging them to do all the things discussed. • Pick the ones you feel will work for you.

20. Questions & Answers