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The hostel sector is expected to expand across Europe thanks to the new sharing economy, reveals a recent report from hotel consultancy firm HVS.
The Budget Hotel Sector's Position in the Sharing Economy report, assessing the limited service and hybrid hotel sector, found that the budget and hostel sector is set to grow as more guests than ever are prioritising experience over formality and basing accommodation decisions on information gleaned on social media. This sector also includes private rental agencies such as the burgeoning Airbnb where some rooms have even started to top hotel prices in London.
The report also revealed the largest proportion of guests that prefer to stay in budget accommodation choose to book through their smartphones - both direct and via travel agents - signifying the emergence of a new sharing economy where 'access to' products and services takes precedence over 'ownership'. This sharing economy is expected to encourage online accommodation bookings to grow, forming greater links between guests and smaller hotels. With offline bookings predicted to continue decreasing, it is imperative now, more than ever, for hoteliers to take stock of their online presence and ensure that it is effective.
Harry Douglass, author of the report, commented: "The industry is embracing technology to make sales from the 'now generation', a consumer group that makes instant hotel decisions, often based purely on online peer to peer platforms such as Facebook and Twitter - which have become the new 'word of mouth'."
The research covered eight countries in Europe and demonstrated the budget and hostel sector has expanded from 8% of the market in 2008, to 10% in 2014. It is predicted to reach 12% of the market in 2017. The report was released to coincide with the second Hostel and Budget Traveller Conference held in London this November - an event which further signifies that the hybrid hotel sector is gaining momentum.
