Exercise may come at a high price in Dubai, as a new report by Deutsche Bank shows the city has the world’s second most expensive gym memberships at an average $119.20 per month, but GymNation co-founder Frank Afeaki believes many are not prepared to pay the fee.
Afeaki started the affordable fitness centre in Dubai with co-founder Loren Holland after finding it hard to justify spending up to AED 5,000 on gym memberships.
“For every one person that is prepared to pay the high prices, there are twenty who are not. Most residents find gym prices in Dubai to be prohibitively expensive, and the fact that a third of all GymNation members are first time gym goers, is testament to the claim,” he said.
Both Afeaki and Holland have been part of low-cost gym chains in Australia (Crunch Fitness) and the UK (Xercise4Less), and had spotted a gap in the UAE market for a similar concept.
Holland said that while operating costs such as real estate, manpower and marketing are high, other factors can be eliminated or added to achieve a quality offering which is affordable for consumers, he said.
GymNation charges as little as $34 compared to the $119.20 average monthly rate of many gyms in Dubai.
On the contrary, Mohammed Khammas, CEO of Al Ahli Holding Group, which owns Gold’s Gym franchise, said people would spend where they see value. Gold’s Gym members get first access to concert tickets and the chance to win meets-and-greets and participate in Al Ahli’s movie investments, with some members having been flown to Hollywood for red carpet events. It is this value proposition that Gold’s Gym bases its 20-30% rise in membership fees.
“It becomes a lifestyle choice. We’ve put together a variety of events that tap into your lifestyle choices. It could be fitness, music, comedy, live events. When you combine this for our retailers and shoppers at Outlet Mall and for our Gold’s Gym members, it gives them tremendous value and you’re not competing on price,” he said.
Guillaume Mariole, founder and CEO of Dubai-based Ignite Fitness, suggested gym prices will naturally adjust soon as consumers have become more price aware, yet he said there remains a market for high-end offerings in the city, particularly for specialist gyms.
“I believe prices will come down, but for gyms with a specific proposition, they can still charge a premium, and I think the target audience they are appealing to, are willing to pay. The buyer has become more knowledgeable and price aware so in the near future I predict that prices in general will come down and offers with regards to membership periods and benefits will be adjusted too,” he said, adding that location plays a crucial part in pricing.
“Location is important in Dubai, as people want to avoid traffic at all cost, so certain areas will be able to keep their high prices while others will need to offer lower rates,” he said.
Founder of TK MMA Fitness gym, Tam Khan, said highly priced memberships are related to the standard of living that Dubai residents are used to, particularly those in attractive areas such as DIFC, JBR and Dubai Marina.
“You can’t have normal blood and sweat gyms in Dubai. It’s not the same as cities such as London. People want and expect high service because that’s the lifestyle they know here. And in order to do that, [gym operators] have to charge higher prices. If a gym is cheap, people will wonder why. They’ll think it’s too cheap to be true,” he said.
Despite his gym’s unique selling point - mixed martial arts - Khan offers lower than average rates to preserve clientele in what he admits is a tougher economy, revealing he’s seen a slight drop in memberships. Ultimately, he suggested it is up to the government to regulate prices.
“[There should be] some kind of commission where [the government] regulates gym prices. Just as hotels and restaurants are rated in stars, perhaps gyms can be too,” he said, further suggesting a self-servicing gym model popular in Europe.
“Maybe solutions include concept like Europe’s 24 hour gyms, where you don’t have staff, you just have an access card, so you enter, do your thing, and leave. That’s taking over London and it’s only about AED70,” he said.For all the latest health and fitness news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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