Restaurant Tipping Trends: How Tipping Culture is Evolving in 2025

Lately, tipping culture seems to be reaching a tipping point (pun intended).

I recently dined out with my partner and got an automatic 18% gratuity on our bill-for just two people?!

Tipping used to feel like a choice, but now it’s everywhere: cafes, kiosks, and even self-checkout screens. While tipping has always been a defining feature of the American dining experience, it’s clear that tipping culture is undergoing a transformation. From the rise of digital payment systems to the growing debate over fair wages, the way we tip—and where we’re expected to tip—is changing faster than ever.

For restaurant owners, navigating this new landscape requires a delicate balance: supporting your staff while ensuring a positive experience for your customers. Let’s dive into the key trends shaping tipping in 2025 and how you can adapt to them.

Key Tipping Trends for 2025

1. Digital Tipping Prompts and "Tip Creep"

Have you ever walked into a coffee shop, placed your order at the counter, and as you’re checking out, the screen suddenly flashes: “Add a tip?" with high percentages like 20%, 25%, or even 30%? Or maybe you’ve gone to pick up takeout, and the cashier flips the tablet around with a bright, cheerful tipping prompt staring back at you. You pause, wondering, “Wait, am I supposed to tip for this?”

If this feels familiar, you’re not alone. This is tip creep in action.

Tip creep is the growing expectation for customers to tip in more places—and often for higher amounts—than ever before. What started as a way to supplement the income of workers in traditionally low-wage jobs, like sit-down restaurant servers, has now spread to industries and services where tipping was rarely expected.

From takeout counters and drive-thrus to self-checkout kiosks and even vending machines, tipping prompts are everywhere. And it’s not just the places asking for tips that’s changing—it’s also the amounts they’re suggesting, often starting at 20% or higher.

While these prompts can increase tips for your staff, they can also lead to tip fatigue, where customers feel overwhelmed by constant requests to tip. 

To navigate this trend:

• Be Transparent: Clearly communicate when tipping is optional versus expected. For example, at a counter-service café, you might include a note like, “Tips are appreciated but never expected.”
• Set Reasonable Defaults: Avoid pre-set tip amounts that start too high (e.g., 25%). Instead, offer a range (e.g., 15%, 18%, 20%) to make customers feel comfortable. Also include options "No Tip" and "Custom" giving more flexibility to your customers.
• Educate Customers: Use signage or your website to explain how tips are distributed among your staff. Transparency builds trust.
  

2. Full-Service Dining: Tipping Remains Essential

This is a no-brainer, in full-service dining, tipping isn’t just a courtesy—it’s a critical part of how servers and staff earn a living. Servers often rely on tips to supplement their base wages, which can be below minimum wage in many states. Tipping isn’t just a bonus—it’s a significant portion of their income. For customers, tipping is a way to show appreciation for excellent service, from attentive waitstaff to knowledgeable sommeliers.

However, as tipping culture evolves, customers are increasingly asking questions like:

“Am I tipping enough?”

“Should I tip on the pre-tax or post-tax total?”

“How do I handle tipping in large groups?”

The standard ranges remains:

• 20-25% for excellent service
• 20% for good service
• 15% for satisfactory service

To ensure fairness and consistency:

• Train Your Staff: Equip servers with the skills to provide exceptional service, which naturally encourages higher tips.
• Communicate Expectations: Make sure customers understand tipping norms for full-service dining. A small note on the menu or check receipt can help. (e.g., “For excellent service, consider tipping 20-25%”).

3. Decline of Cash Tips

Cash is no longer king when it comes to tipping. In 2025, only 15% of tips are given in cash, down from 30% in 2020. The shift toward digital payments, accelerated by the pandemic, has made cash tips increasingly rare.

While digital tips are easier to track and distribute, ensuring that servers receive their fair share, the decline of cash tips has left some servers feeling less connected to their customers. Cash tips were often seen as a way to reward exceptional service discreetly, and their decline has created a sense of disconnect.

How to Encourage Cash Tips:

• Offer Small Incentives: Provide discounts or perks for customers who pay with cash, subtly nudging them toward cash transactions.
• Add a Friendly Note: Include a message on receipts or menus, like “Cash tips are appreciated and go directly to your server.”

By promoting cash tips in a natural, unobtrusive way, you can help servers feel more valued while maintaining a positive customer experience.

4. Generational Shifts in Tipping Habits

Generational differences in tipping habits continue to shape the landscape in 2025. Gen Z, now firmly established in the workforce, has emerged as the most generous generation when it comes to tipping. Studies show that Gen Z diners are 25% more likely to tip above 20% compared to older generations. This generosity may be driven by their familiarity with digital payment systems and a strong sense of social responsibility.

Meanwhile, Baby Boomers and Gen Xers remain more conservative in their tipping habits, often sticking to the traditional 15-20% range for sit-down meals but resisting tip prompts in non-traditional settings. Millennials, caught in the middle, tend to tip generously in some situations but are also the most vocal critics of tip creep.

To cater to all generations:



• Offer Multiple Payment Options: Ensure your system accommodates both digital and cash payments.
• Educate Customers: Use signage or social media to explain tipping norms and how tips support your staff.
  

5. The Rise of Auto-Gratuity

Auto-gratuity, or automatic tipping, is becoming more common, especially in larger groups or high-volume dining settings. Many restaurants now add a standard gratuity (often 18-20%) to bills for parties of six or more, ensuring that servers are fairly compensated for the extra effort required to serve larger groups.

But here’s the catch: some restaurants are starting to apply auto-gratuity in unexpected situations—like adding it to bills for parties of just two. I recently experienced this myself, and I’ll admit, it left me confused. Why was I being charged an automatic tip for a small table?

While auto-gratuity can simplify tipping for customers and guarantee fair pay for staff, it can also lead to confusion or frustration if not clearly communicated. For restaurant owners, striking the right balance is key.

How to Implement Auto-Gratuity Effectively:

• Communicate Clearly: Always inform customers about auto-gratuity policies upfront, either on the menu, signage, or verbally by staff.
• Be Transparent: Explain why auto-gratuity is added (e.g., “An 18% gratuity is added for parties of six or more to ensure our team is fairly compensated for their hard work.”).
• Offer Flexibility: Allow customers to adjust the tip if they feel the service did not meet expectations.

What's Next for Restaurant Tipping?

As we look ahead to the future of restaurant tipping, several key trends are poised to shape the industry. From greater transparency to innovative hybrid models, these developments will not only impact how customers tip but also how restaurants manage and distribute gratuities. For restaurant owners, staying ahead of these trends is essential to maintaining customer trust, supporting your staff, and ensuring a seamless dining experience.

1. Greater Transparency in Tipping Practices

Customers want to know where their money is going, and restaurants that provide clear, detailed breakdowns of how tips are distributed will build trust and loyalty.

How to Implement Transparency:

• Use Signage and Menus: Clearly explain when and where tipping is expected. For example, include a note like, “Tips are shared among our staff to ensure fair compensation for everyone who contributes to your dining experience.”
• Leverage Your Website: Create a dedicated page or FAQ section that outlines your restaurant’s tipping policies, including how tips are distributed and why they matter.
• Print Custom Messages on Receipts: Use your POS system to print messages on receipts that explain tipping practices. For example, “Thank you for dining with us! Tips are shared among our team to support their hard work.”

By being transparent, you not only build trust with customers but also empower them to make informed decisions about tipping.

2. Invest in right technology

Technology is playing an increasingly important role in the future of tipping. Modern point-of-sales (POS) systems, like those offered by ZBS POS, can streamline tipping processes, making it easier for customers to tip and for you to distribute tips fairly.

How ZBS POS Products Can Help:

• Automated Tipping Prompts: ZBS POS systems include customizable tipping prompts on both POS terminals and kiosks. These prompts clearly state options to customize tips or select “No Tip,” giving customers flexibility and control.
• Custom Receipt Messages: Use ZBS POS to print custom messages on receipts, such as “Thank you for dining with us! Tips are shared among our team to support their hard work.”
• Tipping Calculations: ZBS POS systems can calculate different tipping totals (e.g., 15%, 18%, 20%) and provide a space for customers to write in a custom tip amount.

By implementing ZBS POS products, you can create a seamless and transparent tipping experience for your customers while ensuring fair compensation for your staff.

3. Training Your Staff

Your staff are the face of your restaurant, and their performance directly impacts tipping. Providing comprehensive training can help them deliver exceptional service, which naturally encourages higher tips.

Key Training Areas:

• Customer Service Excellence: Teach your staff how to create memorable dining experiences that leave customers eager to tip.
• Upselling Techniques: Equip your team with strategies to increase bill totals, which can lead to higher tips.
• Handling Difficult Customers: Train your staff to navigate challenging situations with grace and professionalism, ensuring positive outcomes for both customers and employees.

4. Monitoring Customer Feedback

Customer feedback is a valuable resource for understanding how your tipping practices are perceived. Are customers feeling pressured to tip? Do they appreciate the transparency you’ve implemented? Regularly gathering and analyzing feedback can help you refine your approach and address any concerns.

How to Gather Feedback:

• Surveys: Include a brief survey on receipts or your website to gather insights about tipping.
• Social Media: Monitor comments and messages on platforms like Instagram and Facebook to gauge customer sentiment.
• Direct Conversations: Encourage your staff to engage with customers and ask for feedback about their dining experience.

Transform How Your Restaurant Handles Tipping

The future of restaurant tipping is evolving, driven by technology, changing customer expectations, and a growing emphasis on fairness and transparency. By staying informed about these trends and implementing thoughtful strategies, you can create a tipping system that benefits both your customers and your staff.

From leveraging modern POS systems like ZBS' point of sale, Front Station,  to adopting hybrid tipping models, there are countless ways to navigate this shifting landscape.

The key is to remain proactive, transparent, and customer-focused, ensuring that your restaurant thrives in the years to come.