Generation Touch Will Redraw Consumer Tech

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The Harsh Realities Surrounding Mobile App Investing

Editor’s note: Josh Elman is a partner at Greylock Partners. Follow him on Twitter @joshelman.

Ten years ago, young adults and those in their late teens were among the fastest and earliest adopters of new social networks — Friendster, Myspace, and ultimately Facebook — and many other products that define us today. So we should be looking to today’s generation, who people often refer to as Millennials, to predict how we will all live and connect 10+ years from now. This generation has grown up differently than everyone who came before it (including me). They have grown up in a world of constant mobile connectedness. They are as different from prior generations as were Baby Boomers who grew up with the first televisions, and earlier generations who grew up with the very first cars or electricity. They have never really known a world without Internet, mobile devices or social media.

In the past decade alone, many of the fundamentals of technology have changed, and as a result, so has this generation’s priorities:

  • This generation owns and carries significantly more mobile phones than desktop or laptop computers.
  • In a recent study, 65 percent of teens polled would rather go without a car than their mobile phone.
  • Interfaces are radically different: no longer are terms such as “keyboard shortcuts,” “save,” or even “click” as relevant as terms such as “gestures,” “share,” and “tap.”
  • As people are always connected (both to the Internet and to each other socially), there is less and less sense of privacy than ever before.

I like to call this group “Generation Touch” or GenT. What excites me the most about GenT is how differently they think about the software and products they use. At 16, I couldn’t imagine anything greater than to finally borrow my parent’s car and drive to hang out with my friends. But to GenT, their freedom exists in the form of the Internet and their devices — and it’s the new consumer products we see growing quickly that embody these trends.

This generation has very high expectations. They expect everything to work by touch. They assume no privacy by default, but also understand the intricate dynamics when they share something. They demand immediate response no matter where they are. They create more and more connections with other people — and they’re doing it in ways that can be hard for previous generations to understand.

Touch is fundamentally important here. Generation T understands and anticipates gestures at a level beyond that which people who grew up with a mouse and keyboard expect. It’s apparent when you realize that the most popular and addictive apps that this generation uses have novel ways of using touch to create deeper connections.

Touch is fundamentally important here. Generation T understands and anticipates gestures at a level beyond that which people who grew up with a mouse and keyboard expect.

Vine or Instagram require a physical press and hold to start video capture, and a constant connection to keep capturing, broken and restarted as one releases and press again. Snapchat only shows a picture when you maintain direct contact with the screen during the fleeting moments before the snap expires. When you swipe right in Tinder (to signal you are interested in someone) you have already physically connected with that person by touching their face before you even get a response. Already I’ve heard “I’d swipe right for you” entering mainstream conversation. As we tap and swipe our screens, these visceral feelings radically change our connection with the software. If you are building anything new on mobile or tablet today, it is critical to think about gestures and how to enhance that connection in every way possible.

GenT also exists in a world constantly connected, but — perhaps unsurprising to our generation — they often feel alone. Because of that, they have been gravitating to products that help them create true personal relationships and enabling “real talk”. The social networks they grew up with made it so easy to share anything with large groups that to GenT, they have started to feel more like popularity contests than communication utilities. So, how do they take a step back? How do they find the private, real, conversations in a noisy world of social sharing? It’s the third phase that comes after social: a technology that still lets GenT interact, but can also take them away from the noisy world that they’ve been living in.

We’re seeing just the beginning of that third phase today. Myriad companies are building their products using strategies aimed at the GenT consumer. For example, in communication, the explosion of companies such as MessageMe, Kik, Viber, Line, WhatsApp, Snapchat, Tango, and Wechat are evidence of the growing consumer demand for new forms of online communication — immediate, private, personal, and emotional. These technologies allow consumers the ability to express themselves through much more than just words but with stickers, pictures, selfies, video, and much more.

Even current leaders like Facebook and Twitter are going to have to work hard to stay relevant in this new world.

What is most interesting (or perhaps is just normal) is that this generation is not adopting most tools used heavily by the generation before. They barely use email or instant messaging at all, and avoid SMS as much as they can since it still costs them money. As they get new smartphones, they get much more excited about downloading their new apps and setting up usernames than getting their new phone numbers. This is similar to 8-9 years ago when incoming college students were only excited about their new email addresses so they could finally sign up for their Facebook accounts.

The companies that depend most on users actively using their email or IM accounts at the core of their networks — Yahoo, AOL, Microsoft/Windows Live, and even Google/Gmail — have already lost that part of the daily engagement of this generation. In order for them to be relevant 10 years from now, they need to be creating new products that capture this generation’s interest — starting with new forms of connecting with their friends and beyond, or defining new gestures to wrap around important experiences. Even current leaders like Facebook and Twitter are going to have to work hard to stay relevant in this new world. Tencent is a great example — not sure if you’ve realized, but Facebook isn’t the only company that just crossed $100 billion in market cap. Tencent has been a web mainstay in China with several massive communication networks. But today, it’s seen as reinventing itself through Wechat – a new mobile communication network that now has more than 400 million users worldwide.

As an investor, I couldn’t be more excited about what is happening right now. I feel like so many existing experiences can be reinvented with the right simple gestures on mobile, and the needs and wants of Generation T are going to become the foundation of many massive companies of the future.

Disclosure: Greylock Partners’ portfolio includes Facebook, Instagram, and MessageMe. Josh is a former employee of both Facebook and Twitter.