The First Wave of wellness is also when therapeutic massage and other spa treatments began to move outside of the luxury resorts and retreat centers where they had flourished for decades and into more accessible neighborhood day spas. The Day Spa Association was formed in 1988 and the International Spa Association (iSPA) in 1992 to serve that nascent industry. In addition, the first small studios offering the ancient wellness practices of acupuncture, Ayurveda, Chinese medicine, Tae Chi Qigong, and Reiki emerged during this time.
In short, the Boomer-led First Wave of wellness created a vibrant industry where none had existed before. First Wave entrepreneurs applied new thinking to age-old practices and leveraged the latest technologies—personal computers, videotapes, and DVDs—to reach millions of people and stimulate decades of massive growth. All of this laid the groundwork for the next wave, which would be even larger and more impactful.
The Second Wave of Wellness (1997–2010): Gen-X-Driven and Internet-Enabled
In the mid-1990s, the first cohorts of Generation X reached their 30s and began to adopt wellness practices alongside their Boomer elders, and before long they began to reshape the industry with their decidedly different personalities.
The Gen-X personality is commonly characterized as more independent, individualistic, and pragmatic than Boomers. Blake Beltram and I are Gen-Xers, and we know their experiences and personalities well. We experienced the social upheavals of the 1960s and 1970s as children, and became adults in the time of the AIDS epidemic. Often called the “latchkey generation,” we were far more likely than Boomers to have divorced or dual-income-earning parents. We encountered drugs and alcohol at an earlier age and witnessed the excesses of our Boomer causes and ideologies first-hand. Growing up faster and harder than our Boomer elders, Gen-Xers are classically more skeptical and independent-minded. These characteristics make us more entrepreneurial as well.
Whereas the First Wave of wellness was characterized by homogenized brands and large, multi-purpose health clubs, the Gen-X-led Second Wave was driven by specialized practices and locally authentic independent studios. These smaller-footprint businesses had a key feature of much lower startup costs and significantly less financial risk than the Boomer-led health clubs. In the late 1990s, thousands of Gen-X-led yoga, Pilates, and indoor cycling studios began to spring up, providing their trailing-edge Boomer and Gen-X clientele with more personalized wellness experiences.
Due to their smaller scale, these smaller studio businesses could not afford the expensive client-server software that had been created for health clubs, and that software didn't meet their specialized scheduling, client, and staff management needs anyway. Therefore, for the first several years of the Second Wave, most of these early boutique wellness studios ran on pencil and paper, which restricted their ability to grow. That technology gap would become the opportunity that Blake Beltram and I founded Mindbody to address in 2000.
At first, the operators of large health clubs saw the boutique wellness movement with a blend of dismissiveness and curiosity. In 2005, the first year that Mindbody had a booth at the annual IHRSA conference, the preeminent fitness industry event of the day, there were no other boutique wellness brands represented in the exposition hall. We were such an oddity that the conference staff misunderstood the online nature of our software and misspelled our company name. Our badges and the trade show guide described us as “mind and body on the line.” We spent that first conference explaining to bemused health club operators that we were in fact a Cloud software company. Their ambivalence toward us and the boutique wellness movement would soon change.
A few years later, a successful health club operator approached me at our IHRSA booth and complained, “Thanks to you, dozens of these little fitness studios have popped up to steal all my members. I feel like Gulliver being surrounded by the Lilliputians!”
That club operator's experience and response reflected a transition happening all over the globe. Changing consumer tastes and a disruptive technology had fueled a shift in the wellness industry. Tens of thousands of boutique fitness studios had emerged, leveraging the latest technologies of the day to provide a more compelling customer experience at a fraction of the cost. It would be several more years before a significant number of club operators would begin to shift their business models, while many of them would linger in Elisabeth Kübler-Ross's first two stages of grief—denial and anger.
During the Second Wave of wellness our world was hit with multiple crises—the dot-com bust and recession of the early 2000s, the 9/11 attacks and War on Terror, the Financial Crisis of 2007 and 2008, and the long, slow recovery of 2009–2010. Rather than slowing the Second Wave down, each of these challenges actually stimulated wellness industry innovation and growth.
In each of these crises, millions more people faced with increased stress and reduced household incomes de-prioritized big-ticket purchases and prioritized self-care, social connections, and affordable luxuries. Crises fueled more demand for wellness services.
Meanwhile, on the business side, corporate layoffs caused tens of thousands of new wellness entrepreneurs to enter the market with new businesses. At Mindbody, we called these people the “Corporate Refugees,” and their energy, resources, and business acumen vastly increased the supply of high-quality local wellness experiences. Several of the boutique brands launched by corporate refugees would go on to become some of the most successful wellness brands we know today (see Figure 3.1).
As these well-known brands prove, crises present opportunities, and you don't have to wait for good times to launch a successful business. In fact, times of recession and strife are the best times to launch an innovative brand.
The Second Wave of wellness firmly established the boutique wellness movement, greatly expanding the size, diversity, and positive impact of the industry. That set the stage for a third and even larger wave of wellness, fueled by the proliferation of smartphones and other connected devices, and the emergence of the largest wellness-oriented generation yet.
Figure 3.1 Examples of Successful Wellness Brands, 2001–2010
The Third Wave of Wellness (2011–2020): Millennials, Smartphones, and Cloud Technology
In the early 2010s, as large numbers of 20- and 30-something Millennials began to enter the workforce, they adopted boutique wellness practices more rapidly and in greater numbers than Gen-Xers and Boomers. As the older generations were still fully engaged, this Third Wave was almost completely additive to the industry.
Millennials are more globally connected and massive in numbers than any previous generation. Coming of age concurrently with the emergence of global high-speed Internet, cloud computing, and powerful smartphones, the Millennial generation is the first to truly think globally. You can speak with tech Millennials in India, China, Japan, and the other developed countries of Asia-Pacific, Europe, and Latin America, and you will find they have more in common with each other than they do with the older generations in their own countries.
Millennials prioritize experiences and social connections over material possessions. They experienced 9/11 as children and the Great Recession as young adults. They grew up with the War on Terror and saw their parents' nest eggs decimated by the real estate crash in 2008–2009. They also attended college in greater numbers and took on more student debt than any previous generation. Many of them struggled to launch their careers during the slow economic recovery of the early 2010s. These formative experiences shaped the Millennial mind, giving them a strong aversion to financial risk and big-ticket purchases. There are plenty of Millennial entrepreneurs,
