How 3 simple buttons raised tipping by $144 million in NYC cabs

If you’ve ever been to the city of New York during the past five years, you’ll know that cab drivers don’t always give off a warm and cuddly feeling. This was especially true for short trips, where I’d whip out my debit card and have to argue with the driver that I didn’t have any cash on me ’til he finally gave in.

Lately, however, the attitude towards paying with cards seems to have shifted — just in time for our new in-cab iPads. So, what’s caused the change? Here’s what one Joshua Gross found:

“During payment, the user is presented with three default buttons for tipping: 20%, 25%, and 30%. When cabs were cash only, the average tip was roughly 10%. After the introduction of this system, the tip percentage jumped to 22%. Those three buttons resulted in $144,146,165 of additional tips. Per year. Those are some very valuable buttons.”