I love anything open late at night. Never mind ‘the sigh of midnight trains in empty stations’; even mundane activities like filling up with petrol become enjoyably Edward Hopperish after midnight. Often the places are so quiet you wonder why they bother opening at all.
But it is a strange psychological fact that opening a shop 24 hours a day often pays, even if nobody ever buys anything between 1 a.m. and 6 a.m. Somehow the knowledge that the shop never closes means people are far more likely to shop there at conventional times. This quirk also explains why the most successful coach firm between Oxford and London runs services all night: not because people really want to travel between 2 a.m. and 5 a.m., but because they like to know that they can.
This, I think, explains the anguished reaction of many Londoners when it was suggested Transport for London may refuse to relicense Uber. It isn’t only that people like using Uber; they also like knowing it exists.
A case in point: ever since Uber cars became established in London, I barely drive into London at all (I live just outside the M25). Previously I did so once a week. This wasn’t by choice (after all, if I wished to recreate the experience of driving in London, I could sit in a stationary car at home while stabbing my head repeatedly with a fork). No, before Uber, I was forced to take my car into London simply because if my event overran or if the trains went funny, or if it started raining and the black cabs were all taken, or if I was in that 90 per cent of the city where black cabs don’t go, then I was irredeemably stuffed. My car wasn’t a form of transportation, it was a fallback position.
In all those 50 non-car-journeys in the last year, I used an Uber to get home only once. The other 49 journeys took place as planned by train. But I made those 49 journeys by train largely because Uber now offered me an acceptable second-best alternative.
To understand Uber, you have to look at it not as a replacement for public transport — it is a complement to it. Trains are now much better because of Uber, if only because you have a possible plan B where none existed before.
None of this detracts from perfectly justifiable criticisms of Uber. Their egregious tax avoidance, say, or the fact that, by losing money on every journey, it is unfair competition. I also sympathise with black-cab drivers who gained the Knowledge only to find technology had eroded their one-time monopoly of picking people up on the street. But if Uber disrupts the London minicab business, which was generally awful, I can’t say I’m upset.
It is worth remembering that many unfashionable large businesses create value in ways that are often under-appreciated. No one will ever write gushingly about McDonald’s or Starbucks or PremierLodgeExpress. But what these large chains do is valuable, even if you never use them. They effectively raise what I call the ‘threshold of crappiness’ in the sectors in which they operate. To operate successfully as a coffee shop or a sandwich bar or hotel (or a minicab firm), you have to be at least as good as a chain or else you fail. This raises the bar for everyone. You can get better coffee in a truckstop now than at Claridge’s in 1990.
It is easy to forget how bad the service sector was in Britain before these chains emerged. Once in 1989 a meeting overran so I had missed the last train south. ‘Where’s the best place to stay in Sheffield?’ I asked my host. He paused for a second and replied ‘Leeds.’
Rory Sutherland is vice-chairman of Ogilvy Group UK.
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