Case Synopsis

Three sisters from the United Arab Emirates have established a fitness studio for women in Al Maqta’a on the eastern side of Abu Dhabi. Each of them shared a passion for sport, which led them to realize their business idea of setting up a fitness studio specifically for women. An understanding of Emirati culture and the needs of women in their society inspired them to think of a special place where women could find relief from work and life demands while also exercising pursuant to a healthy lifestyle. They launched Tone Ladies’ Fitness Studio in September 2014, the first fitness studio for women in Al Maqta’a. The studio is in the same building as a cooperative hypermarket – a very good location because it is visited by many people and has ample parking spaces.

Partly due to growing interest amongst Abu Dhabi residents in fitness and health, new fitness studios opened nearby in 2016, with competitors offering excellent services at reasonable prices. While the demand for fitness and healthy lifestyle pursuits is high in the region, the market has also expanded greatly to meet this demand, with many high-quality options becoming available. As a result of this, businesses such as Tone are facing serious threats to their sustainability. Thus, first, how can the Omer sisters sustain their business and strategize to maintain customers in their market segment? Second, what could they do to improve the market position of Tone in the UAE fitness market?

Opening Statement

During a regular management meeting at Tone Fitness Ladies’ Studio (Tone), Amna Mohamed Omer and her two sisters – the studio’s owners – were discussing the challenges they faced in the studio’s market. Amna, Tone’s marketing manager, shared a monthly report on the studio that distilled the declining trend in the number of clients over the previous six months. The loss of clients had caused many classes to be canceled due to insufficient demand, forcing Tone’s managers to change instructors’ schedules.

Tone’s policies allow clients to cancel classes at least two hours before their start time without being charged. Mariam and Hind agreed with their sister’s concern, noting that there seemed to be several indications that Tone’s market position was under threat. They knew that if they didn’t find a way to resolve this issue, their business would struggle to survive, especially because any financial shortfalls incurred would have to be met personally by the sisters.