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I took a cab to the motel. Getting my card out and getting ready to cover the trip. There' s a chance you might be willing to buy more, too. Tip-raising technology is a sophisticated way for electronic payments processors to use sophisticated strategies to raise the tip, and while it is certainly good for hard-working waiters, it may not be as good for your purse.
According to a new review by technology researcher Software Advice, point of sales devices like the one in my booth are increasing the incidence and number of customer advice messages. In a recent survey in the state of Iowa, a provider of portable payments quotes a method that encourages effective consumer spending on tip. Writer Kam Leung Yeung writes: "After swipe through their card, the consumer then has to either select between... pre-installed peak values (e.g. 15%, 20% or 25%), or input their individual peak value, or opt not to tip at all.
Rather, the higher tip is the outcome of some interesting designs by the payments process. On the one hand, electronic gateways make tips just as simple as tips - a clear shift from the previous method of paying. Once currency was royal, anyone who didn't want to tip could simply left the currency behind.
" In the case of a premium rate system, however, the deal is not completed until the purchaser has made an express tip decision. Ensuring that clients do not lose sight of tips is certainly a good thing. Tip agreements state that the appropriate amount for a taxi driver's tip is in the 10% to 18% area.
Selecting a prepaid amount is just simpler than modifying the tip amount, even if you know that you are giving too much tip. New York City Taxi & Limousine Commission reports that tip rates have risen from 10% to an annual 22% when the new pay screen is turned on. Those tools also make it easy for the customer to let go of their cash.
Another way they remove what Duke Dan Ariely describes as the pains of payment. The torment of separating from our cash has to do with the devotion to see that cash disappear," says Arialy. "In other words, the less genuine cash you feel, the less it hurts to pay it out, and consequently we pay more of it.
Paytors have followed in the tracks of another branch that has actually alleviated the pains of making payments - the gaming one. In order to make a game of chance today, the cash must first be deposited on a customer card. Once the card is immersed in the engine, it turns into points.
You know that players will be spending more if their currency doesn't look like it. Just as the delivery of a tip with hard currency once involved the physical sensation of leaving the purse, the act of making a tip is now obscured by the use of electronic payments. Using electronic payments, shoppers just push a few knobs with their finger and the fun is gone - just like in a game.
Yeung, the writer of the Iowa State Survey, is calling for state measures to prevent consumer use of these schemes. It states that "policy maker should further investigate alternate payments mechanisms that can offset the comfort of making payments and the corresponding expenditure-regulating effect. "The problem Yeung poses with these schemes is that they make humans buy more without even noticing.
Certainly, they are not all poor when it comes to electronic payments. First, they enhance the customer experience by making transaction simpler and quicker and eliminating the obsolete card-wiping and pen-signing devices that most merchants still use today. Most of us don't have the amount of free space or intellectual leeway to think about how the way we choose to spend will affect how much we choose to spend.
Unfortunately, we don't know how these intersections use our deep psychological understanding to alter our behaviour through designing.