The effects of tipping policies on customer satisfaction: A test from the cruise industry

Lynn, Michael; Kwortnik, Robert J.

doi:10.1016/j.ijhm.2015.08.005

Cited by 30 publications

(19 citation statements)

References 9 publications

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“…In addition, these consumers were more likely to mention the tipping policy, service/servers, and prices when reviewing tipping as opposed to no-tipping restaurants and mentions of the latter two of these topics were associated with reliably lower overall restaurant ratings. These findings extend previous evidence that overall cruise ratings and restaurant service ratings are higher under tipping than under service charge systems (Kwortnik, Lynn, and Ross 2009;Lynn and Kwortnik 2015). They are also consistent with previous findings that consumers prefer tipping over its alternatives (Azar 2010;Lynn 2017), tipping reduces actual and perceived restaurant expensiveness (Lynn 2017;Lynn and Wang 2013), and tipping increases perceived service quality (Kwortnik, Lynn, and Ross 2009).…”

Section: Discussionsupporting

confidence: 90%

“…In addition, Kwortnik, Lynn, and Ross () found that consumers' ratings of service were higher at Miami Beach restaurants with tipping than at those with automatic service charges. Finally, Lynn and Kwortnik () reported that Carnival Cruise's customers rated their overall cruise experience more positively before the cruise line replaced tipping with automatic service charges than they did afterward. These studies do suggest that tipping enhances customer satisfaction, but they fall short of making a compelling case.…”

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confidence: 99%

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The Effects of Tipping on Consumers' Satisfaction with Restaurants

Lynn¹

2017

Journal of Consumer Affairs

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This paper contributes to the policy debate about whether or not tipping should be outlawed by identifying the potential pros and cons of tipping from a consumer perspective and assessing their net effects in a field study that compares restaurant customer satisfaction under tipping and no‐tipping systems. Recent changes in the restaurant chain Joe's Crab Shack's policies regarding tipping provided an opportunity to assess the effects of those changes on customer satisfaction. Analyses indicate that online ratings of the dining experience were reliably higher when the rated restaurants operated under a tipping system than when they operated under a no‐tipping, service‐inclusive pricing system. These findings provide an important counter‐argument to those calling for the abolition of restaurant tipping.

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Section: Discussionsupporting

confidence: 90%

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confidence: 99%

The Effects of Tipping on Consumers' Satisfaction with Restaurants

Lynn¹

2017

Journal of Consumer Affairs

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“…We now normalize and nondimensionalize the system (2)- (7) to reduce the number of parameters. We make the following substitutions…”

Section: B Normalized Modelmentioning

confidence: 99%

“…At many points in time, tipping has been considered downright anti-democratic [6]. Yet the practice persists because the vast majority of Americans prefer to choose how much gratuity they leave after a meal [7,8].…”

Section: Introductionmentioning

confidence: 99%

The tipping point: A mathematical model for the profit-driven abandonment of restaurant tipping

Clifton

Herbers

Chen

et al. 2018

Chaos

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The custom of voluntarily tipping for services rendered has gone in and out of fashion in America since its introduction in the 19th century. Restaurant owners that ban tipping in their establishments often claim that social justice drives their decisions, but we show that rational profit-maximization may also justify the decisions. Here, we propose a conceptual model of restaurant competition for staff and customers, and we show that there exists a critical conventional tip rate at which restaurant owners should eliminate tipping to maximize profits. Because the conventional tip rate has been increasing steadily for the last several decades, our model suggests that restaurant owners may abandon tipping en masse when that critical tip rate is reached.

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“…To understand how this idea has come about, it is important to note that the interest on tipping has, for many years, predominantly centred on testing other explanatory frameworks. Authors have tested the relationship of customer tipping behaviours to bill size (Lynn, et al, 2012), service quality (Lynn and Kwortnik 2015;Becker, et al, 2012; Wang 2013) and/or by feelings of reciprocity (Becker, et al, 2012;Lynn 2016;Lynn 2018).…”

Section: The Tipping Normmentioning

confidence: 99%

Serving Beers, Turning Tricks and Keeping the Change

Ochoa¹,

Vladimir²

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The effects of tipping policies on customer satisfaction: A test from the cruise industry

Cited by 30 publications

References 9 publications

The Effects of Tipping on Consumers' Satisfaction with Restaurants

The Effects of Tipping on Consumers' Satisfaction with Restaurants

The tipping point: A mathematical model for the profit-driven abandonment of restaurant tipping

Serving Beers, Turning Tricks and Keeping the Change

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