Question: Why are health club members lining up for fitness classes led by outrageous performer-instructors with names like Mad Dog, and for workouts in extravagantly designed clubs such as those operated by Crunch?

Answer: Because we have entered the experience economy in which work is now theater and our clubs are our stage.

In The Experience Economy, authors B. Joseph Pine and James Gilmore describe how the world has moved from an industrial economy, to a service economy (the prevalent model for the past 20 years), to an economy in which experience is the principal determinant of economic output.

It is an economy where “work is theater and every business a stage,” and where the winners will be those companies that can engage their customers in a personal and memorable way.

In such an environment, those of us who work in the industry have two options:

• We can either compete more intensely with one another, cutting prices and, in the process, stifling growth.

• Or we can embrace the experience economy, and stake a claim to a bigger share of a changing and rapidly expanding market.

• If we elect to seize the opportunity--and I have no doubt that we will--we’ll need to develop new forms of “exertainment” that will make exercise more enjoyable for our customers, firmly hooking them on the fitness habit. We already have a head start over most of our competitors.

• Exercise is, after all, intrinsically and intensely experiential. It’s a quick, easy, and surefire solution for people who, condemned to immobility by sedentary jobs and entertainment options, now hunger for physical activity. This counter-reaction to sedentary lifestyles, and corresponding desire for improved health and fitness, has already led to an explosion in the number of clubs worldwide.

But how can we enhance the exercise experience even more--in order to achieve our full potential?

We can start by improving our stage. Operations such as Crunch are showing the industry how it can reinvent the fitness environment. They’ve become the hippest game in town. Their wild décor makes for fun, and allows them to attract more members--and charge higher prices--than comparable facilities.

Next, we need to look at our theatrical “productions.” Some clubs are taking the theater concept very seriously in their cardiovascular rooms, installing huge video walls and state-of-the-art sound systems to create a dramatic environment. Others are taking advantage of the ongoing evolution of fitness equipment to enhance the exercise experience. Equipment manufacturers continue to explore and invest in new cardio and strength equipment as well as virtual reality applications.

There are many other ways--beyond décor and equipment--to enrich the club experience. Some facilities seduce members with trendy designer apparel. Others parlay their personal trainers, who impart incredible value to the industry, especially when they combine their professional expertise with great interpersonal skills. We have 70 personal trainers--including local sports and entertainment stars--working out of our Auckland gym. But of all of the things that we can do to make workouts more exciting and inspiring, I’m convinced that group exercise holds the greatest potential. Some clubs, including our own in New Zealand, hold classes that attract hundreds of participants. The energy that these sessions generate is incredible--it’s like being at a rock concert or a memorable Broadway performance. Today, the best instructors aren’t just exercise experts--they’re great entertainers as well. We’re witnessing the emergence of a brand new breed of performing artist… and of a compelling new exertainment experience.

These changes within our industry suggest that we have already instinctively embraced the experience economy. In the future, as we do so consciously and consistently, exercise and fitness will play more of a role in more and more lives. And we will find that IHRSA’s 100 Million by 2010 initiative seems, if anything, timid.

Equipment manufacturers are, obviously, also playing an important part, by providing group exercise equipment and programs that are inherently more entertaining and that challenge instructors’ creativity. There are now imaginative offerings involving bikes, treadmills, stairclimbers, elliptical motion machines, rowers, strength training equipment, and yoga, Pilates, and hiking in the great outdoors. Who could ask for more?

Phillip Mills is the president of Les Mills International, based in Auckland, New Zealand, the developers of the BODYPUMP, BODYATTACK, BODYFLOW, RPM, AND BODYSTEP group-fitness programs.