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Relational travel transforming traditional accommodation value chains

Written by editor

The IHG Kinship economy report indicates that the role of accommodation is changing as travelers become more tech savvy and are increasingly seeking experiences that will help them to develop relation

The IHG Kinship economy report indicates that the role of accommodation is changing as travelers become more tech savvy and are increasingly seeking experiences that will help them to develop relationships with others. New forms of “relational travel” are helping to transform traditional accommodation value chains into more extensive “value webs” (that include many non-tourism elements, such as the local community) faster than ever before (UNWTO, 2011).

As STAY WYSE gears up to release the latest findings on the youth travel accommodation industry at WYSTC 2013, the organization is providing a brief recap of the recent research on the accommodation industry and YTA industry as a whole, which points towards the rapidly changing face of consumer demand.

Increasingly, business and leisure travelers will start carrying new high-tech “accessories.” These portable sources of information have radically changed the way in which people search for and book accommodation. The trends observed in the New Horizons research indicate that mobile bookings will increase rapidly in future.

One in four travelers have used social networking sites to plan their travel while 45% have made travel plans based on reviews and experiences of others. This is true of both leisure and business travel. According to Google & Ipsos Media (2011), one in three business travelers posts reviews online of properties they stay at. Other Google & Ipsos Media (2012) surveys indicate that almost a quarter of affluent leisure travelers currently book accommodation via a mobile device.
In contrast, “Traditional travel publishing has been in decline in the UK over the last seven years: overall, guide sales have fallen by 30% during this period.” It is also having an impact on the way in which young people use and experience accommodation:

“Hotels could be used as local community hubs, for example with local bands and artists coming and performing, meaning that the hotel has much more connection with the community. This is why people like boutiques at the moment – people want to experience the local.”

In many ways the traditional hotel sector is now starting to mimic the relationship building function that has long been at the heart of the Youth Travel Accommodation (YTA) product and which is particularly important for hostels.
The continued blurring of boundaries between different forms of accommodation means that YTA suppliers have to face new areas of competition, particularly from budget hotels and apartments. However, the changing landscape of youth travel also presents new opportunities. As the New Horizons research shows, new forms of accommodation such as couch surfing are not replacing the traditional hostel – they may even be driving new areas of hostel business. For example, 37% of couch surfers also stayed at Hostelling International property while travelling, and 67% also stayed at a backpacker hostel. Because these people also travelled more and spent more on accommodation than the average young traveler, they also spent more money on accommodation in total. As hostels are also now often functioning as gathering places for couch surfers in some cities, this also represents an income opportunity.

A recent HostelBookers Survey on Why Women Travel Solo (2013) indicated that women still love to travel alone. In common with the findings of the New Horizons survey, the women surveyed by HostelBookers balance their desire for freedom and adventure with a healthy sense of caution. “Freedom” (28%), a “sense of adventure” (17%) and “learning about yourself” (15%) were cited by respondents as the top reasons for travelling solo. 64% stayed in hostels, underlining the benefits of hostels as cheap places to stay where you can meet new people and become part of a community of travelers.

Hostel statistics from different parts of the world indicate stable or growing demand in spite of the economic crisis. European Hostelling International members reported over 26 million bed nights in 2012, an increase of 6% compared with 2010. In New Zealand, backpacker accommodation overnights increased 2.9% in May 2013 compared with May 2012 and occupancy levels increased by 2.3% points.

Major commercial hostel groups are now challenging budget hotels, according to a report from HVS (Douglass, 2013). The report indicates that the top 10 groups in Europe including A&O, Meininger and Generator now have a total of more than 35,000 beds spread across 100 properties.

Seminars on “Insights into the Youth Travel Accommodation Market” and Between Conflict and Cooperation – finding win-win outcomes for hostels with online travel agents to find out more on the latest developments in the Youth Travel Accommodation Industry are on offer in Sydney.

• Insights into the Youth Travel Accommodation Market: Wednesday, September 18, 10:45 to 12:15, SCEC – G03 Parkside

• Between Conflict and Cooperation – finding win-win outcomes for hostels with online travel agents: Thursday, September 19, 10:45-12:15, SCEC – G06 Parkside

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