Rating a Service Before Tipping Negatively Impacts the Tip Amount
Marketing
Jinjie Chen, Alison Jing Xu, Maria A. Rodas, Xuefeng Liu
Published in Journal of Marketing, June 2022
Nowadays, more and more services are asking customers to rate and tip service professionals. The design of each app is different, some apps allow customers to rate the services before tipping, while some others ask customers to tip before they rate. How would the order of these two decisions affect each other?
An international research team, with Dr Jinjie Chen from the Department of Marketing of City University of Hong Kong as the first author, has found that requesting customers to rate service professionals first can lead to smaller tips, whereas asking customers to tip first does not influence subsequent rating scores.
Dr Chen and his co-authors found in a survey that consumers and service professionals intuitively believe that soliciting ratings first should lead to larger tipping amounts. However, counter to these intuitions, their research showed that rating first actually decreases subsequent tips that customers give to service professionals.
The research used multiple methodologies, including field experiments, lab experiments, and archival data analysis. In one field study, the research team hired a driver in the United States to provide shared ride services by alternating between the two ridesharing platforms Uber and Lyft. The same driver then recorded the amounts of the ride fare and the tip received from each ride. The study found that, after controlling for the base fare, Uber riders, who rated the driver first, tipped smaller amounts than the Lyft riders, who tipped the driver first. Additional studies also revealed that tipping a service professional first does not seem to influence the ratings consumers would provide.
In another field study conducted in a restaurant in the United States, the research team found that rating a service professional first before making the tip decision decreases the tip amount by 13 percent, a significant portion of income for service professionals in the restaurant industry.
“How much people tip is not only important for service professionals financially, but can also impact their morale and retention rates, which are also important for companies. Therefore, when designing service platform interfaces, companies should consider asking customers for their tipping decisions before rating decisions,” says Dr Chen.
