Has digital tipping become too invasive? We asked Charlotteans. Here’s what they said.

More businesses, including those in Charlotte, are using digital technology to request tips from patrons.

According to a report on top restaurant trends for 2023 by Wakefield Research, 52 percent of full-service restaurants are continuing to use contactless payment options with another 50 percent offering kiosk devices or QR code alternatives.

From restaurants to coffee shops to salons, multiple establishments are using digital touch devices that allow customers to leave gratuity over the old-fashioned tip jars.

But as technology has evolved, some business owners see digital options as a benefit for staff and customers.

“I think it actually makes it a little easier for our guests, where they’ve got the ability to take care of it all themselves at the table where they don’t have to give their credit card away. So it makes it feel a little more secure for them,” Sean O’Brien, owner of RuRu’s Tacos and Tequila in Myers Park, told CharlotteFive. “It lends to the speed of service. Guests are able to get in and out of a restaurant a little bit quicker.”

Other local business owners agreed, saying that digital payment options help staff with the overall flow of service.

“It just made our entire service model more efficient.” Matt Chipley, general manager of Brewers at 4001 Yancey in South Charlotte explained. “It’s an ease for everyone.”

But as more businesses adopt digital payment methods, so does the frustration for customers who find themselves automatically prompted to leave a gratuity.

Charlotte resident Wilbur Hood said he doesn’t mind tipping around 18 to 20 percent when he goes out to eat because restaurant employees depend on the extra cash.

“A lot of times, with takeout, I’ll still tip, because I know that’s where a lot of people make their money,” Hood said. “As long as I’m getting good service, the food is good, and I’m being taken care of, I don’t have a problem with it.”

But Stephanie Egan and Juliann Sedar said they believe digital payment methods – which seldom give the option to not tip – can make customers feel pressured.

“I think it makes you feel guilty because it automatically pops up,” Egan said. “You’re like, ‘Oh, if I don’t do it, I’m a bad person.’ I think it’s a little excessive. You should at least get the option to say no.”

Sedar pointed out that a 20% tip at personal care service industries such as nail and hair salons, for instance, could lead to unwanted charges for services that already cost hundreds of dollars.

“Are you supposed to tip?” Sedar asked. “You’re already paying $300 to get your hair done. Do I need to pay 20% of $300? That’s a lot of extra money.”

While attitudes on tipping differ, data show that customers were much more likely to leave generous tips after the pandemic.

According to digital payment company Square, tips at full and quick-service restaurants went up by about 16% during the last three months of 2022 compared to the same period in 2021.

How digital tipping model helps businesses

Mason Jenkins, a marketing professor at UNC Charlotte who specializes in consumer behavior, attributed the rise of digital payment methods to a “spillover effect,” where business owners are more likely to adopt something they see is working for other businesses.

“A lot of the tablets and screens that are used as point-of-sale systems for different businesses already come with these options installed on them,” Jenkins said, referring to varied tip amounts. “Many business owners might take that as a clue that they should deploy them.”

Digital payment methods are beneficial to customers and business owners, Jenkins said. They are often easier for customers to use, and data show that they generate higher tips from customers than traditional payment methods.

Forbes’ 2023 Digital Tipping Culture Survey found that 65% of people tip at least 10% more when they tip digitally versus with cash.

Since social norms are effective in influencing behavior, said Jenkins, consumers may be more inclined to tip because they see others doing the same.

“Because tips are now being requested in these ambiguous or unusual situations, seeing other people tip might be a clue to the consumer standing behind them,” said Jenkins. “I do think we’re at a crossroads right now where small amounts of tips for counter service and low service provider situations might become the norm over time.”

This story was originally published March 2, 2023 at 7:00 AM.