Reports

The Manipulative Art of Pre-Service Tip Elicitation

Nathan B. Warren, Sara Hanson, and Hong Yuan , 2019, 19-111-02

As service providers automate point-of-sale interactions, changing customer-technology interfaces are fundamentally altering frontline service experiences. Businesses are increasingly using mobile point-of-sale applications, such as Square, and mobile technology, such as iPads, to prompt customers for tips in contexts where tips have not historically been expected.

These tip requests frequently occur at the start of the service transactions, before any service has been provided. Inconsistent practices among service providers indicate that practitioners are unsure how to best integrate new technology into tipped service scripts.

In this study, Nathan Warren, Sara Hanson, and Hong Yuan test the effects of pre-service versus post-service tip request sequences in four scenario-based experiments with participants drawn from two pools of online workers. Their research examines the effects of tip sequence across three different service contexts: online delivery, quick-service food, and beauty service.

Their findings reveal that requesting a tip before (versus after) completing a service leads to reduced return intentions, diminished word of mouth, lower online ratings, and smaller tips. Customers’ perceptions of service provider manipulativeness are shown to be the psychological mechanism underlying the harmful effects of requesting a tip before service.

Their findings also suggest that emphasizing the firm’s customer-serving motivations for automation can reduce, but not eliminate, the negative effects of pre-service tip requests. Additional analysis suggests that ensuring customer privacy during the tip elicitation process improves evaluations of service providers.

Put into Practice

Contrary to practice among point-of-sale app users, these findings suggest that service providers should avoid requesting tips before serving customers.

Specifically, the authors show that customers evaluate pre-service tip requests as more manipulative than post-service tip requests, leading to negative outcomes for service providers across multiple populations and diverse contexts.

However, their results also indicate that service providers who choose to request tips before serving customers can achieve better outcomes if they emphasize their motivations to better serve customers and ensure customer privacy during the process.

Overall, this study suggests that managers should be careful when implementing new tip-requesting technology, and pay particular attention to the sequence of tip requests. Service automation can provide many benefits to consumers and service providers but when it is improperly implemented, it may also unintentionally harm service providers.

Nathan B. Warren is a doctoral candidate in marketing, University of Oregon, Lundquist College of Business. Sara Hanson is Assistant Professor of Marketing, University of Richmond. Hong Yuan is Robert P. Booth Associate Professor of Marketing, University of Oregon, Lundquist College of Business.

Acknowledgements
The authors are very grateful to the 2018 SERVSIG conference and to Linda L. Price for their helpful and constructive feedback.

 

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