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Thanks for the Tip (and the importance of real Service)

August 17, 2011

By Bill Duggan, Group EVP, ANA

A pet peeve of mine concerns tipping. More and more, tipping seems expected. There's the tip jar at the coffee shop - hey that latte cost $4.75 ... and you want me to tip on top of that? 

Recently I ordered takeout dinner and when I picked up my order at the restaurant there was a tip jar on the counter - but I was the one who drove five miles, each way, so why should I be tipping? I'm happy to tip for service when eating at a restaurant, but certainly not when I pick up takeout!

Hotel room service tipping is always tricky (and a bit of a rip off). Recently, the room service order at a hotel I stayed at included both a "delivery" charge (a flat $4 fee that worked out to 17% for my breakfast) and a "service" charge (23%). Plus, there was a line for an optional additional gratuity. Isn't 40% enough? Those optional tips on top of existing ones are just obnoxious.

But the best (or worst) example of tipping excess are New York City taxis. For riders paying via credit cards, the default tipping options provided are 20%, 25%, or 30%. Passengers can override the default options and pay any tip they want but these options are hard to believe. C'mon ... 20% for a low tip? (Credit to the Wall Street Journal and Rob Shepperson for the image.) On the other hand, I think this is genius for whoever thought of these options as it surely leads to higher tips for the drivers.

I am appreciative that companies like McDonald's do not have tip jars. The service provided is simply part of the experience and value-proposition. It's expected at McDonald's and is not an "extra." Tipping is a payment that's over and above what's due and it should be an extra reward for superior service.

Service, in my view, is an increasingly lost art. Companies like USAA, Nordstrom, L.L. Bean, and Public Supermarkets have strong reputations for customer service. (See Business Week's rankings of the top companies for service) Kudos to those companies and none of 'em have a tip jar!

 

 

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