28 February 2008

Booming budget accommodation market slips under travel industry radar

TravelMole guest comment by David Smith, general manager of Hostelbookers

The online budget accommodation market is booming. While other traditional powerhouses of the travel industry flounder in the face of changing technologies and rapidly shifting consumer demands, it continues to go from strength to strength.

Itââ¬â¢s been quietly going about its business, steadily growing, year on year, but still slipping under the radar.

Which makes it all the stranger that it still doesnââ¬â¢t get the attention that some other less buoyant sectors command.

Rise in Independent Travel

We all know that travellers want to build their own holidays organically. From the bedrock of a youthful gap year, student travel and backpackers base, the independent travel market has expanded. More and more people are taking time out from work and setting off on sabbaticals. And theyââ¬â¢re not staying in five star hotels.

As a reflection of this development, the HostelBookers customer demographic has shifted markedly upwards in the last couple of years. Since 2005, the average age of customer has increased from 24 to 32.

Changing Perceptions ââ¬" Improved Quality

So now that practically everyoneââ¬â¢s an independent traveller, the budget accommodation market has had to react to match this demand. The old ââ¬Ëœchores and lockoutââ¬â¢ image of hostels has been well and truly consigned to the past.

The cheap hotel market has become complacent - ripping off their customers with cheap(ish) prices but little or no value.

The hostel industry is starting to compete and has become a very viable alternative. More and more people are now aware that a hostel is more likely to have flock wallpaper, free WiFi, rainfall showers and a rooftop bar, than bedbugs and bad plumbing.

The ââ¬Ëœflashpackingââ¬â¢ culture (budget travel with gadgets and gizmos) and the rise of the super-chic ââ¬Ëœboutique hostelââ¬â¢ are just a couple of examples of the way in which the market has responded to a shifting demographic.

The review-based culture of online booking, and an increasingly internet savvy customer base have also forced the standards of the global hostel and budget accommodation market to improve.

We have helped pull together a fragmented market whilst recognising the need for a quality ââ¬" not quantity ââ¬" approach to listing properties.

HostelBookers is the only major online provider not charge a booking fee and the only website in the industry that carefully selects its members and constantly reviews performance of its 10,000 budget properties to weed out the lower end.

Responding to Technology

While everyone gets into a lather about buzz words of the hour like ââ¬Ëœuser-generated contentââ¬â¢ and ââ¬Ëœsocial networkingââ¬â¢, independent travelââ¬â¢s been at it for years.

Forums are abuzz with travellers locked in discussion, happily swapping tips and exchanging travel ideas. Over half a million customer ratings from HostelBookers.com customers help to reassure travellers of what theyââ¬â¢re booking and reveal independent travelââ¬â¢s sharing culture.

But if the initial scepticism of many customers has been broken down, the same canââ¬â¢t necessarily be said for some quarters of the travel industry.

One thingââ¬â¢s for sure, though: budget accommodationââ¬â¢s big, and in these days of economic uncertainty, itââ¬â¢s only going to get bigger.