Last month Hostelworld released its Evolution of the Hostel Traveler report. We learned some valuable insights into how present and future generations of travelers book hostels. Let's discuss how these behaviors can affect your pricing strategy.
Do you compete with other hostels in your area? If so, you’re probably checking regularly to see how much the competition is charging. If you don’t monitor your competition’s prices carefully, you’re either missing out on extra profit by making your beds too cheap or missing out on bed nights by making them too expensive. 49% of Generation Z backpackers reference price as what will attract them to stay at a hostel. The problem is, how the prices change is only half the picture. When the prices change is important too.
When your hostel changes prices is just as important as how you change your prices. Today’s hostel travelers are price sensitive, they’re booking in advance, and with the vast majority of hostels selling online, backpackers have perfect information into what a bed’s current market value is. Getting smart with dynamic pricing is an effective way to increase your profitability and decrease anxiety from low occupancy nights.