The Market Power of Millennials

wraparound-glassesFour or five times in just the last week I’ve seen news articles that reminded me that we are moving into a millennial world. It’s starting to become clear that millennials are already having a big impact on numerous traditional industries.

We certainly can see the impact of millennials in the telecom industry. New millennial households aren’t buying traditional cable TV packages and landlines. Because of this the average viewer age for traditional TV programming has skyrocketed, which is upsetting the advertising in our industry. Millennials love their smartphones and are happy to use them for the majority of their computing needs. And some are even starting to leave smartphones behind in favor of wearable devices like the Apple iWatch.

This is the first generation that had a radically different childhood than earlier generations. This generation grew up with computers and that seems to have changed them more than past technologies changed other generations. I’m a baby boomer, and we were the first generation to grow up with television and that changed us a bit from our parents. But at the core, the baby boomers still shared mostly the same experiences growing up as their parents, be that with school, church, leisure or social activities.

But it’s becoming obvious that growing up with computers changed the millennials from their parents. This is the first generation that was fully immersed in social networking, texting, smartphones, online shopping and all of the many things that come with being computer-centric.

The millennial phenomenon is not limited to telecom and computers. Millennials are walking away from ‘traditional’ institutions of all kinds. Interest in the NFL and Major League Baseball is dropping – largely due to the fact that millennials aren’t interested. NASCAR has seen attendance and interest drop like crazy – which is something you might expect from a generation that values connectivity more than the past car-centric generations. Church attendance is down. Voting in elections is down. Subscriptions to newspapers, magazines, and traditional news outlets of all kinds are down. Millennials are shunning fast food restaurants, shopping malls and traditional department stores. The bottom line is that this generation has made a big break from the way their parents did things.

So what does this all mean for ISPs, telcos and cable companies? First, it seems to me that millennials also have a different expectation for what it means to be a customer. They are used to buying things online and having the package delivered the next day. They are used to making appointments online and communicating in real time. This is a generation that has already walked away from email and is in the process of walking away from texting. It looks to me like this generation won’t do business with companies that don’t make it easy. For example, everybody in my generation moans about how painful it is to deal with the big cable company – but the millennials seem willing to walk away completely from the cable company or anybody else that is too hard to use.

I build business plans that look forward anywhere from five years to twenty years and sometimes I am not quite sure what to do about millennials in these plans. The one thing our industry sells that millennials seem to like is fast broadband. They live in a video-rich world and like to have multiple streams of video and music running at the same time. It looks like they are ready to slide easily into virtual and enhanced reality technologies which should strengthen their need for broadband. My guess is that millennials will be the ones forcing us oldsters to participate in virtual meetings and using other new technologies.

As different as the millennials are, I really wonder about how different their kids are going to be. If you have recently watched a five year old kid with a smartphone you quickly realize that they really don’t live in the same world as we do, or even as their millennial parents. I don’t know that any of us knows what to expect from the post-millennial generation. That generation is going to grow up in a world of virtual reality, artificial intelligence and all of the new technologies that will be hitting the streets over the next decade. The gulf between them and their grandparents is going to be immense.

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