George Flooks said the current value offering in the sector is of 'low, low value'
Fitness First Middle East CEO George Flooks has launched a scathing attack about the value offered by the region’s low cost gyms, as the company prepares plans to launch into the budget market themselves.
Flooks revealed that the budget concept will be opened by Fitness First Middle East, which is wholly owned by Landmark Group, under a completely different brand.
He said: “We’ve looked at the budget sector for a number of years and it’s a sector that we’ve decided that we’re going to get into within the next three months.”
Flooks believes the company’s new offering will address what he believes is a shortfall between price and value.
Low value
While the base price is often appealing to potential gym-goers, he warned the necessary additional charges can push the price up to unrealistic levels.
He said: “If you look at the current offering that’s out there it’s low, low value, in terms of the facility and what’s on offer. People will say it’s a very low price, but it’s actually a very high price.
“When I say it’s low value, it’s because a lot of the services you still have to pay for. You think you’re entering at a low price, you’re entering at AED199 a month for a 12-month contract that’s rolling, or you’re entering at AED299, which is just a monthly rolling contract. But it doesn’t come with WiFi, it’s a low value – Starbucks has WiFi, Costa has WiFi.
“When you look at those type of offerings, it’s very low in terms of value. Everyone today is on a treadmill with their own YouTube video or playlist plugged in. If you don’t have WiFi, you’re going to pay for it.
“Then you pay for everything else. For example, some of the group exercises you pay for. If you go for a HIIT (high-intensity interval training) class or you go for a jump class, you’re paying AED50 for that class. If you’re paying AED299 for the flexi of no contract, and you’re doing one class a week, that’s an extra AED200, you’re paying AED499 and that’s more expensive than Fitness First, at a very low value.
“The current model, once you look into it, people just see the headline price, but they really don’t understand what’s going on between the lines.”
Disposable income
Flooks also dismissed suggestions that the budget brand could cannabalise what they have already, with Fitness First Middle East very much an upper mid-market brand.
“We’ll match the price point, we’ll just give you significantly higher value in that market,” he said.
“Statistics will show that people spend about ten percent of their disposable income on health clubs/gym memberships. If you look at our current offering in the upper mid-market, it’s a different target audience.
“In Burjuman we’ve had a budget offering open literally 100m from our club. We’ve had our best month ever in Burjuman; month-on-month, year-on-year, we’re up something like 56 percent in membership.”
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