The give and take of tipping

American Demographics, Feb, 1997 by Tibbett L. Speer

It looks like an advertising cliche from the 1980s. You're out at a restaurant with a few friends, and at the end of the meal, someone enthusiastically whips out a plastic card. But wait -- she's not offering to buy your dinner with her newly acquired "gold" card. She's figuring out how much everyone owes for the tip.

Those laminated cards that display the proper tip for various meal prices make the process look precise and mathematical. But in reality, tips depend on many factors, some of them unpredictable. They may have little to do with the size of the bill or the quality of service. They are prone to the vagaries of uncontrollable events, like the weather. Often the characteristics of tippers themselves predetermine what they'll spend, regardless of the performance of hapless -- or happy -- recipients.

American culture includes few ground rules about when and how to offer gratuities for services rendered. The most universally accepted one is that waiters and waitresses get tips. Almost all (94 percent) people who have the occasion to tip food servers always or usually do so, according to a 1996 nationally representative telephone survey of 1,000 adults conducted by Market Facts, Inc. of Arlington Heights, Illinois. Furthermore, virtually everyone in the U.S. eats in a sitdown restaurant at one time or another.

When it comes to other kinds of services, however, the rules are not so clear, perhaps because their use is not as universal. Just half of adults say they ever use a taxi or limo driver or parking attendant. Forty percent are never served by bartenders, and 36 percent don't have people carry their luggage at hotels or airports. Even when they do take advantage of such services, Americans are not as likely to reward the people who provide them as they are to tip food servers. About three in four people who ever use taxi/limo drivers, hairstylists/barbers, luggage handlers, and parking valets always or usually tip. Twenty-eight percent of people who stay in hotels or motels with maid service never tip the women who make their beds and bring them clean towels.

In France, restaurants automatically include a gratuity on the bill. But this isn't the custom in the U.S., and in general, businesses can't and don't force the issue. Most can only gently encourage customers to tip, as well as encourage their employees to act in ways that elicit tips.

It's in their interests to do so, too. When customers leave bigger tips, workers are happier. This benefits employers, because happy workers hopefully work harder and are less likely to steal on the job or quit. And although the connection is not crystal clear, businesses that help their employees earn better tips may improve their own economic health by increasing levels of customer satisfaction, word-of-mouth recommendations, and repeat business.

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REWARD OR SYMPATHY?

For those who think of a tip as a reward doled out to an inferior, it feels awkward to thrust cash into an outstretched hand. But nobody should feel embarrassed, according to one economist who considers tipping a hallmark of our march toward efficiency. "This institution is very important toward getting good service," says Orn Bodvarsson, associate professor at St. Cloud State University in Minnesota. "If we didn't have such a system, as was the case in communist countries, wed get lousy service." In studies of about 700 patrons at central Minnesota restaurants, he and fellow researcher William Gibson found that most were pleased with the service they received. The tip rate varied significantly around a mean of 13.6 percent. Many went above or below the traditional 15 percent figure.

The conclusion is that diners don't automatically tip 15 percent, but use it as a benchmark and leave more or less in proportion to their impression of the service. Frequent customers tip more than others, a sign they are "investing" in future good service, but one-time visitors also seem to contemplate the service they receive. "Tippers are actually being quite calculating and rational about it," Bodvarsson says. "In this belief, we take issue with the psychology people."

Among the "psychology people" to whom he refers is Mike Lynn, associate professor at Cornell University's School of Hotel Administration. After years of study on tipping, Lynn concludes that bill size is by far the largest predictor of tip size, followed by the social relationship between customer and server. If servers introduce themselves, squat down next to the table, or touch the customer, tips go up, according to some proponents of this theory. Perceptions of service play a much smaller role in tipping decisions, Lynn says.

Average Americans, however, claim that service quality is, in fact, the most important factor in their tipping behavior. More than half say they tip food servers based on service, according to the Market Facts survey. Fifty-one percent say that service is the main factor in their decision to tip hairstylists, and 44 percent say it's the most important reason for tipping bartenders.