Thanks to some early data from Pizza Girl, of Slice fame, I have some very preliminary findings.
There are a few different ways to tip, check (only one person did this), credit card at the door, pre-tipping with a credit card and cash. As seen in these boxplots, cash tippers were the highest, on average. Pre-tippers, who really are just tipping based on feeling, not performance, have the greatest variability. There was even someone who only pre-tipped a dollar. Pre-tipping a large amount might be a good idea–kind of like greasing a palm at a restaurant to get a table–but I don’t see how a small pre-tip is a good idea.
I wonder why people give bigger tips with cash than with credit cards. I would have thought it would be the other way around.
This is just the beginning. Pizza Girl is providing more data as the weeks go on. And as I get more data the analysis will become more sophisticated, so stay tuned as we unravel the world of pizza delivery. In the mean time, check out Pizza Girl’s third installment of her findings on Slice.
Jared Lander is the Chief Data Scientist of Lander Analytics a New York data science firm, Adjunct Professor at Columbia University, Organizer of the New York Open Statistical Programming meetup and the New York and Washington DC R Conferences and author of R for Everyone.
In my experience people give better tips with cash because they just hand over some bills and don’t necessarily do the math. On credit card slips or machines they have to put in a specific dollar amount and tend to go lower.
I am equally perplexed at the cash vs credit tipping difference since the conventional wisdom is that people spend more on credit cards because there isn’t a concrete reminder of how much money they’re actually spending and how much they have left.
When dining out people who tip using a credit card tip 3-5% higher than those paying with cash. This is the actual percentage used by the IRS to estimate the hourly rate servers in Las Vegas make so they can be taxed accordingly. I’ve also noticed this trend outside of Vegas. It’s weird that this doesn’t apply to delivery drivers. I assume it’s because of the lack of respect drivers get and not because someone can’t afford 2-3 more dollars. I’m also not sure why someone would pre-tip and expect good results. When people grease palms at restaurants it’s usually at least $5 but the average is $20.
Usually when I get delivery I pay by credit card but tip in cash. If I were to tip with the credit card I would tip an actualy percentage, but when I hand the delivery guy cash, I’m going to give him (or her) bills (rounded up) rather than coins. So I think @FreakPirate is on to something.