New study says hostel sector booming across the world

studyThe backpacker sector of the travel industry is booming and much of the growth is down to bookings made online through smartphones, according to a new study.

The commercialised private rental market is being pushed by services such as Airbnb and is part of a worldwide growth in budget and hostel travel, according to the report by HVS.

Sharing economy

The study says that consumers increasingly value access to, rather than ownership of, goods and services and this is part of a trend towards a ‘sharing economy’ fuelled by social media and other online behaviour.

It also noted that the biggest users of budget accommodation like to book using their phone, whether that means directly with the accommodation provider or by using an online travel agent.

'The Budget Hotel Sector’s Position in the Sharing Economy' report looked at the private rentals market in eight European countries. It found that the budget and hostel sector accounted for 10% of the total market last year, a rise from 8% in 2008. The figure is forecast to grow to 12% by 2017.


The increase in the number of online travel agencies (OTA) booking hotel accommodation, as well as direct access for customers being much easier due to increase web presence of accommodation owners, are both important factors in the narrowing of the gap between guests and smaller independent hotels.

The author of the new report, Harry Douglass, commented: “There are now signs that rather than consolidating the larger hotel groups’ positions, the proliferation of OTAs is fragmenting the market, which may benefit smaller operators who can crowd together.”

“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’.”

Douglass went on to highlight the recent acquisition of a stake in Lifealike Ltd by Hyatt Hotels as recognition by the larger brands of the changing behaviour of customers, especially in what he calls the 'peer-to-peer distribution market'.

If you're planning a hostel tour don't forget to use Backpackers Travel Insurance and buy yours well in advance of you trip.

Date Created: 23 November 2015

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