Bewildered? Latest updates on tipping.

I love Uber and one of the reasons is their seamless approach to payment, that included the tip, which meant I didn’t need to think about it? How much, do I have the right money, do I have any cash? However, cash tipping is now coming to Uber.

The hired ride company is backing off of its previous “no tipping” policy, thanks to a proposed class action settlement in which drivers claimed the company have violated labor laws by discouraging tipping. The San Diego Union Tribune reports that drivers will now be allowed to ask for tips verbally and by placing placards in their cars.

Uber, while agreeing to this policy change, isn’t exactly embracing it. Its website still says “No Cash, no tip, no hassle,” and It won’t be adding a tipping feature to its app, which means that customers will have to pay tips in cash. This seems like a bad move to me, since it goes against Uber’s ‘no cash’ slogan and makes the Uber experience much more like the traditional taxi rides it was meant to replace.

Since I travel a lot on business, I like Uber’s online credit card payment system. It makes it easy for me to track my business travel expenses in one place. Cash tips are much harder to track, and if I’m going to be tipping, I might prefer Uber’s rival, Lyft, because it allows riders to add tips from within the app.

The Union Tribune article rightly points out that Uber’s customers may feel confused by the mixed message of some drivers asking for tips, others not asking, and Uber not making it easy to give one. And because Uber allows drivers and riders to rate each other, riders may worry they’ll get a poor rating and poor service in the future if they don’t give the driver a good tip.

As a customer experience consultant, I’ve seen more and more businesses expecting tips for performing ordinary services.

Many of these businesses are using Square, the device that turns an iPad or Iphone into a mobile cash register. When completing a credit card transaction, customers are asked to tap on the percentage tip they would like to leave, or to tap a button saying they don’t want to leave a tip. While this is a godsend for math-challenged people who planned to leave a tip anyway, it also exerts pressure on customers at coffee shops, ice cream parlors and takeout counters.  If you’re already spending over $5 for a glorified cup of coffee, you may feel cheated when asked to tip a worker who did nothing more than prepare the drink as expected.

These negative emotions – confusion, anxiety, guilt, irritation – also destroy value for the company. If Uber asked us to evaluate the tipping aspect of their customer experience, we would look at the Emotional Signature. This is a specialized research technique that discovers what emotions Customers are feeling and more importantly what drives or destroys value ($) for an organization. This would uncover the feelings that may be influencing riders as they decide whether and how much to tip.

Of course, tipping raises all sorts of political and economic issues. Strictly from a customer experience viewpoint, I think tipping works best when it is not expected, but is an option to reward truly exceptional service. Employees have an incentive to go above and beyond what is expected of them. Customers don’t feel pressured, guilty, or worried about leaving too little or too much. Tipping for exceptional service allows customers to express gratitude and feel generous. This ends their experience on a positive note that translates to good feelings about the company.

How do you feel about tipping? Share your thoughts in the comments section below.

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