Canadians are tipping less, and servers are feeling it. A new report from Actual found 67% of tipped workers report decreased tip amounts over the past two years, up sharply from 39% in 2024. But new data from a Canadian restaurant chain suggests the fix isn’t more pressure at the payment terminal. It’s recognition. Guestologie, a Vancouver-based guest recognition platform, analyzed tables at an upscale casual restaurant chain with locations in Canada and found that those receiving a personal gesture from the restaurant, such as a manager visit or an acknowledgment of a guest’s preference, were more likely to tip 20% or more (20.6% vs. 17.8%), with a higher average tip at every location. The gap held when comparing tables at the same restaurant, in the same month and with the same party size (20.7% vs. 16.5%).
Restaurants tend to make gestures toward guests they already know, so some of that gap may reflect existing relationships. But it lines up with what servers are saying: 76% say tipping incentivizes better service, and 62% believe tips should be tied to quality of service, not the total bill.
Ryan Volberg, Guestologie’s founder and CEO, has spent two decades building restaurant technology and spoke to Retail Insider about:
- Why tipping fatigue has as much to do with how guests feel treated as with what they’re asked to pay
- What restaurants can do to earn tips rather than prompt for them
- Why feeling recognized matters more as Canadians cut back on dining out
What is driving the decline in tipping among Canadians, and how much of what you describe as “tipping fatigue” stems from payment-terminal prompts versus customers’ experiences with restaurant service?
I think there are three things happening. Canadians are feeling the pressure of rising costs, they’re being asked to tip in places where tipping was never expected before, and increasingly they’re questioning whether the service they’re receiving actually deserves the gratuity being requested.
The payment terminal has become the symbol of tipping fatigue, but we’re overlooking something much more important. The problem isn’t always what guests are being asked to pay. It’s what they’re getting in return.
Think about the difference between paying for a dinner where you were treated like just another transaction and one where the staff remembered you, made you feel welcome and genuinely cared about your experience. The same 20% tip feels very different in those two situations. One is given joyfully while the other creates resentment due to the sense of obligation.
Actual’s recent report found that 67% of tipped hospitality workers say their tips have declined over the past two years, while 62% believe gratuities should reflect service quality rather than simply the size of the bill. I think that’s an important message for restaurant operators. We shouldn’t be asking how to get guests to tip more. We should be asking how to deliver hospitality that makes them want to.
Your analysis found that guests who received a personal gesture from restaurant staff were more likely to leave a tip of 20% or more. How was the study conducted, and what steps did you take to account for factors that might influence tipping behaviour beyond guest recognition?
We analyzed a sample of over 600,000 tables, each matched to its bill, across over 50 locations of major upscale-casual restaurant groups operating in Canada and the United States, from June 15 to September 6, 2026.
Guestologie operates inside these restaurants, identifying guests in real time, understanding their relationship with the restaurant and recommending specific actions that staff can take to make the experience more personal. These might include an intentional manager visit, recognizing a loyal guest or acknowledging something meaningful about their visit. Importantly, we record whether those actions actually happen, which allows us to compare tables where recognition occurred with those where it didn’t.
The results were compelling: 20.6% of tables receiving a verified gesture left a tip of 20% or more, compared with 17.8% of tables without one. That’s roughly a 16% higher likelihood of leaving a tip at that level. Average tips were also higher at every location.
We wanted to account for other factors that might influence tipping, so we compared tables within the same restaurant, during the same month and with the same party size.
The difference was even more pronounced: 20.7% versus 16.5%, or a 25% increase.
This was an observational analysis, so we’re careful not to claim that recognition alone caused the difference. But because it draws on real restaurant transactions, it offers a clear view of how closely personalized hospitality and more generous tipping are connected. And that’s exciting because recognition is something restaurants can deliberately and systematically improve.
What specific actions can restaurants and servers take to make customers feel recognized and valued, and how can independent restaurants implement these practices without significantly increasing costs or staff workloads?
Here’s what we’ve learned at Guestologie: Some of the most powerful things a restaurant can do to build loyalty cost absolutely nothing.
Consider a manager visiting a table. There’s an enormous difference between a manager stopping by to ask, ‘How’s everything tonight?’ and one who approaches a guest and says, ‘;I wanted to personally thank you for being such a loyal customer. We really appreciate you choosing to spend your evenings with us.’ The first is routine service. The second is genuine recognition. We call that an intentional manager visit, and it can take less than two minutes.
The same principle applies throughout the restaurant. Welcome returning guests by name. Remember their favourite table or drink. Recognize when a regular hasn’t visited for a while. Make someone on their second or third visit feel like they’re becoming part of the family.
None of this requires expensive giveaways, complicated loyalty programs or asking staff to do significantly more work. What it requires is knowing something about the guest.
Restaurants already collect enormous amounts of information through their reservation systems and point-of-sale systems, but almost none of it reaches the people serving guests when it actually matters. For an independent restaurant, that can start with a few simple guest notes and a focused pre-shift discussion. Guestologie takes that principle further.
Behind what appears to be a simple gesture is sophisticated intelligence: machine learning that understands each guest’s relationship with the brand, recommends the action most likely to strengthen it, and learns from every result.
The goal isn’t to replace genuine hospitality with technology, though! It’s to make great hospitality easier to deliver, consistently, to more guests.
How do you distinguish the impact of genuine guest recognition on tipping from the possibility that restaurants are more likely to recognize regular customers who already have stronger relationships with staff?
That’s an important distinction, and we’re careful about what the data tells us. Our findings show a strong association between guest recognition and more generous tipping, but correlation isn’t causation. We accounted for differences in restaurant location, month and party size, although existing relationships may still explain some of the differences.
But I think the question points to something much more interesting. Anyone can recognize the handful of VIPs already known to the staff. The enormous untapped opportunity lies with the thousands of valuable guests who are effectively invisible: the guest who’s visited four times in six months, the loyal customer whose visits are quietly declining, or someone returning after a long absence. Most restaurants have no way of recognizing those relationships while the guest is actually there.
Spotting those patterns across thousands of guests is impossible for even the best manager to do on their own. It takes machine learning to interpret millions of behavioural signals, turn them into a seemingly simple gesture at the right moment, and then measure what happens next.
Research from Toast and Resy suggests the recognition gap is real: 48% of surveyed diners say being remembered by staff makes them feel most valued, yet only 30% say they consistently experience it.
The industry has spent decades building technology to manage transactions. The next step is using it to manage relationships, making invisible guests and behavioural patterns visible.
Higher tips are an encouraging leading indicator, but the real prize is bigger: creating experiences that make guests want to return more often, building loyalty, and driving measurable revenue growth.
As Canadians face pressure on household budgets and potentially reduce how often they dine out, how do you expect tipping behaviour and customer expectations to evolve, and what can restaurant operators do to maintain customer loyalty and support staff earnings?
I think Canadians are going to become increasingly selective, not just about how often they dine out, but about which restaurants deserve their limited dining dollars.
When you go to a restaurant, you’re buying much more than what’s on the plate. Great food might get someone through the door, but it’s how the restaurant makes them feel that brings them back.
For years, the restaurant industry’s response to declining traffic has been to spend more money attracting new customers, often through discounts, promotions and loyalty points. Meanwhile, existing guests are quietly visiting less frequently or disappearing altogether, often without the restaurant realizing it’s happening.
The better approach is to help operators understand which guests are most valuable and whose relationships with the brand are strengthening or weakening, then turn that intelligence into personalized actions that staff can deliver while guests are actually in the restaurant. Doing that across thousands of guests takes far more than any one manager can track on their own.
The benefits extend to the people delivering that hospitality. Our research shows that guests who receive personalized recognition are more likely to leave generous tips.
Guests feel valued, servers earn more, and restaurants build stronger relationships.
The traffic restaurants are looking for is already inside their restaurants. The opportunity isn’t simply to attract more guests. It’s to give the guests they already have more reasons to come back. Because ultimately, people may forget exactly what they ate, but they rarely forget how a restaurant made them feel.
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