Consumer’s pockets are getting lighter – literally – as more Americans gravitate toward a cashless economy. The average value of cash held in a consumer’s pocket, purse, or wallet decreased by 12% from 2020 to 2021. And today, according to a new report by Pew Research Center, 41% of U.S. adults say that none of their purchases in a typical week are paid for using cash.
The movement toward a cashless economy is propelled by the U.S. consumer’s growing use of digital payments. From browser-based and in-app purchases to person-to-person payments and Buy Now Pay Later options, 89% of Americans in 2022 are now using some form of digital payments to simplify their financial lives.
This shift to a cashless world is creating hiring and retention challenges for hospitality employers, in-home service providers, and organizations that rely on a team of support staff or technicians. Businesses in both sectors thrive when their employees provide superior services to guests and clients, often rewarded with cash tips, but as fewer consumers carry cash, more housekeepers, valets, and service workers are having to cope with the bitter phrase: “Sorry, I don’t have cash.”
As a large employer, it’s in your best interest to ensure your staff is compensated for their hard work and dedication to representing your brand. It’s also your responsibility to provide guests and clients with the best customer experiences to ensure repeat stays and continued business. To bridge the widening gap between cashless guests and hard-working employees, look no further than digital tipping.
What is digital tipping?
Sometimes referred to as cashless tipping, touchless tipping, or mobile tipping, digital tipping is a payment solution that enables the delivery of a gratuity from one party to another via technology. Simply put: Digital tipping allows your hotel guests or customers to tip your staff and team members via a QR code or through your existing mobile app.
How it works
One of the biggest perks of digital tipping is that it’s easy for hotels, or any large brand with an existing app, to implement and utilize. In fact, it’s as straightforward to launch as it is for guests and employees to use. Simply:
- Enable in your mobile app. Digital tipping embeds directly into your existing app – which your guests and customers are already familiar with. No learning curves and no third-party hassles.
- Promote. Send push notifications to guests and customers via your app, or place QR codes on employee badges and business cards, in hotel rooms, lobbies, elevators, and anywhere else staff service members work.
Then sit back and watch as:
- Customers tip. Your guests and clients scan the QR codes or utilize your app to leave digital tips in seconds. All tips are funded by the customer’s existing card that is already stored in their account on your mobile app.
- Employees collect. Team members who want their tips instantly can open a dedicated virtual account and debit card under your brand, where they can receive and spend anytime. Your business can also process and distribute tips through regular payroll.
Here are two scenarios:
Example 1: A new guest pulls into your hotel’s valet parking drop-off zone and is greeted by a valet attendant. The attendant helps the guest from the vehicle and loads luggage onto a bell cart. Handing the keys to the valet, the guest realizes there’s no cash to tip, but quickly spots a sign with a QR code on the valet podium. Using a smartphone, the guest scans the code, opens the hotel’s app, and the guest is able to tip the valet attendant on the spot.
Example 2: Someone rushing to a meeting stops by your front desk to borrow an umbrella to combat the pouring rain. The front desk staff quickly locates an umbrella and gives it to the guest. Dashing to the meeting, the guest realizes they didn’t properly recognize the front desk attendant’s effort and opens the mobile app to tip.
How your employees benefit
As an employer, it’s your job to demonstrate to your team members that you recognize and value their hard work. When your hotel offers digital tipping, it unlocks new financial perks and benefits that motivate and encourage employees to go above and beyond.
With digital tipping, employees enjoy:
- More tips and compensation: Digital tipping lets your hotel increase compensation for its staff without impacting the bottom line. By making it easy for your guests to tip, your employees make larger tips and receive tips more often.
- Fast payouts and instant access to tips: Digital payments are just as instant as physical payments. With digital tipping, your employees can open a virtual account under your brand to access their tips in real-time.
How your hotel benefits
Along with happier employees, digital tipping brings new benefits to multiple areas of your business. With digital tipping, your hotel will:
- Drive app engagement: Bring customers back to your brand’s app again and again. Whether guests tip your staff onsite or they send a link/push notification to tip after the service, your app gets all the traffic.
- Improve customer service: When employees know that great tips are no longer dependent on cash, they’re more incentivized to provide the best service and experience for your customers. QR codes can be placed on badges, business cards, and anywhere service employees work to ensure all tips funnel back to the right service workers or are pooled to the right teams.
- Attract/retain talented employees: Create a work environment that instantly rewards exceptional effort, making it easier for your employees to earn more.
- Provide a better customer experience: Give your customers a simple way to pay for superior service. Digital tipping limits the frustrations of not having cash on hand and ensures your guests can show their appreciation for your staff. Plus, all tips can be applied directly to your guest’s receipt to help simplify expense reports.
- Deliver customized experiences: Customers know and trust your brand, so it’s important for your hotel to remain front and center during all interactions. With a white-labeled digital tipping solution, the entire experience is customizable and can be tailored for your brand and its unique customers.
Find out how to add digital tipping to your mobile app
From digital tipping to full embedded financial services for your customers and employees, Alviere helps you design, launch, and ensure the success of your program. Ready to start a conversation? Reach out today.
