Tipping apps have become the rage in the service industry, being used by everyone from hairdressers and nail technicians to musicians and massage therapists. They’re also showing up in the bus and motorcoach industry, providing drivers with another resource for tips and extra income.
In an era when most people no longer carry cash, these apps are an easy tool for customers and drivers to use. In the past, it was common for drivers to get significant cash tips from tour groups, but that trend has waned in the ever-shifting, high-tech economy. Those changes have had an impact on driver take-home pay and job desirability.
Advocates see the apps as an incentive to retain and recruit drivers, believing the extra money will keep drivers behind the wheel.
“Obviously, there’s a national driver shortage, and as we look to retain and attract drivers, anything we can do to increase the overall compensation is a good thing,” said Pete Borowski, president of New Jersey-based Starr Tours, whose drivers are using a tipping app. “We run quite a few tours and have quite a few charters where driver gratuities are a possibility.”
A number of tipping apps are available on the market. Typically, these apps allow consumers to tip drivers after responding to a “rate your ride” message. The “rate your ride” invitation not only allows consumers the option of tipping but provides an outlet for them to voice their experience, steering them into a productive channel instead of an online rant.
Drivers at Starr Tours, which primarily serves the northeast, began using an app created by Rally, a New York City-based startup, a year ago. So far, the response has been favorable, and the company is looking at extending its use to other drivers.
“From what I’ve heard, drivers like it,” Borowski said. “It’s definitely a differentiator for us. In the transportation industry, we’re competing to get drivers. Besides the other benefits and opportunities to travel places as part of the job, tipping is significant and a potential benefit.”
Rally, the first platform in bus ridesharing, is being used by other bus companies as well. Essentially, the app allows like-minded individuals who are traveling to the same destination or event, such as concerts, protests or football games, to combine itineraries. The platform allows riders to create new trips and incentivizes people to share the trip with a referral bonus. The bus has to be 40-percent full for the trip to go forward.
“We put the request out to local bus companies and select a company based on a number of criteria,” said Siheun Song, co-founder and president of the company. “We are not using the cheapest bus companies, that’s not a good experience for anyone. We are looking for bus companies that understand what we are doing but also embrace our technology. We need them to use our technology.”
For the most part, drivers have embraced the apps.
“Some drivers are initially hesitant. Anything new can be difficult,” said Numaan Akram, chief executive officer of Rally. “Usually, when I say, ‘Hey, you can get extra tips with this app,’ that perks them up and they’re ready to use it. It’s actually easy.”
The bus industry may be behind the curve in the use of technology, but consumers aren’t, said Song, noting taxi drivers once resisted the use of credit card machines, fearful of losing tips.
“It’s been shown that having credit cards means collecting more tips,” Akram said.
Another motorcoach company using the Rally app is Seattle-based Starline Luxury Coaches.
“We’ve been using the app for about six months and drivers love the concept,” said Tom Casazza, the company’s general manager. “I’m not sure what activity has been in terms of drivers, the quantity of tips or anything like that, but I know they’re liking it.”
Several factors are contributing to the lack of driver retention and recruitment, including stagnant wages and benefits, the demands of driving and constant travel and societal changes.
“Our primary source of drivers used to be people who retired early and didn’t want to just sit at home. They wanted to find something to do and ended up driving a bus,” said David Moody, general manager of Holiday Companies, Inc., based in Randleman, North Carolina. “But people are working their primary jobs a lot longer and that opportunity to find people is shrinking. People are not retiring at age 55 or 60, they’re working until they’re 70 or 75.”
Moody, whose company employs about 160 drivers, understands the tipping concern. Holiday encourages cash tips or gratuities be made during group trip prepayment.
“Obviously, there’s a national driver shortage, and as we look to retain and attract drivers, anything we can do to increase the overall compensation is a good thing,” he said
Another tipping app gaining traction with drivers is Bravo, which is also being heavily used by an assortment of service industry workers.
“The adoption has not been at the corporate level but more at the individual level,” said Maria del Carmen Luna, CEO and co-founder of Bravo, launched in 2015. “One clear example we have is a group of drivers who drive tourists from hotels to malls and airports from the hotels. They picked it up organically. We’re seeing a lot of traction.”
The app is available in 1,000 cities, and further expansion is in the works. Luna said the company is in negotiations with a drivers’ union to make the app available to members.
Callen Hotard, chief executive officer of Hotard Coaches in New Orleans, Louisiana, said companies need to make more of an investment to retain drivers.
“If you don’t invest in employees and don’t set them up for success, you won’t have that retention,” Hotard said. “Drivers appreciate ongoing training resources for success. If you just bring drivers in and send them out on the road and don’t provide resources, challenging jobs become impossible.”
Although Hotard’s drivers are not using tipping apps, Hotard understands the needs for other sources of revenue.
“Tips are always a big help in compensation,” he said. “I think anytime drivers have an opportunity to increase earnings and can find a way to do it, that’s a good thing. We need to find more ways to make this a rewarding industry and come up with ways to raise the bar a little bit.”
