Is the No Tipping Trend Actually Trending Downward?
It’s been seven months since Danny Meyer took the restaurant world by storm when he announced that he would end tipping in all 13 of his New York City-based restaurants. Some surmised that Meyer’s move could be the impetus that finally altered America’s tip-happy dining culture. But to what extent is implementing gratuity-free dining plausible in the world outside of a highly-regarded New York City restaurant group?
The crustacean in the coal mine might be Joe’s Crab Shack. Last year, the sit-down seafood chain became the first major chain to test the no tipping model, experimenting with the new policy at 18 of its Midwest locations, representing a decent chunk of its approximately 130 total restaurants. Last Wednesday, CEO Bob Merritt discussed the results of those trials, and they were far from promising: A majority of customers disliked the lack of tipping and it resulted in a drop in diners. Now, 14 of the 18 trial locations will revert back to the old pricing model and a tip line on checks.
“We got negative customer counts between 8 percent to 10 percent on average among the 18 restaurants, and we tried it for quite a while, tried communicating it different ways,” Merritt said in a analyst call, according to Nation’s Restaurant News. Overall, nearly 60-percent of customers didn’t like the no-tipping program, and as Merritt described it, “a lot of them voted with their feet.”
Four of the restaurants did see success with the changes, and for those location, Joe’s Crab Shack is keeping the no-tipping policy in place. “We are going to try to figure out why it worked in some places and why not in others,” Merritt stated. “The way we look at it is: We are really continuing the tests in places with where it works.”
But in general, the results seem clear: No tipping might not be ready to play in nationwide.