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Simple Steps to Improve Your Backpacker / Hostel Business

Article submitted by holidayLOVER

September 19th, 2008

Running a successful backpacker hostel is a fun and rewarding business. People attracted to running their own hostel normally are outgoing, social people with large personalities and smiles. Some people set up a hostel after being backpackers themselves. So what makes some hostels more financially successful than others? The key is to attract as many guests as possible and get guests to stay at your accommodation longer.

"Backpacker accommodation is the fastest growth sector within the accommodation industry in recent years."
Source: Ministry of Tourism May 2007

We know that the typical backpacker is young (18-35 years), educated, adventurous and seeking value for money in their accommodation. Backpackers are interested in active and adventurous activities. Many are interested in experiencing authentic New Zealand activities and enjoy "off the beaten track" adventure. Backpackers want accommodation to be; safe, clean, value for money, and fun.

Getting the potential guests to know about your business is crucial to your success. Limited investing in marketing of your business will lead to failure to maximise the hostel's full potential. Very few are lucky enough to set up a backpackers then just sit back and let the money flow in. You must be hands-on in the promotion of your business. Key things to consider to effectively market your backpacker/hostel include:

1. Signage
Make sure you can good signage on the street front. People need to see your business and find it.
2. Happy Guests
Happy guests are the best marketing tool you can dream of. Ensure that your backpackers offers the best possible accommodation; safe, clean, lots of facilities and features. Word of mouth is a powerful information source. Backpackers' travel itineraries are rarely planned prior to arrival and travel choices are often made following discussions with fellow travellers regarding the best sights, best accommodation and best transport options. A good reputation is worth a great deal, bad news travels fast and is hard to stop.
3. Advertising
An attractive brochure is an important marketing asset. Make sure the photos that advertise your business are as stunning as possible. Free postcards featuring an enticing and good quality image of your local area can also be distributed to backpackers, just add in your backpackers name and contact details (see image below). Postcards will be sent to their friends and family providing more business exposure.

Create Your Postcards with VistaPrint

Given that backpackers are generally well educated and familiar with the Internet, you need to be listed online.
Is your backpackers/hostel listed on KiwiWise.co.nz yet? Get listed NOW by using our contact us form.

Make your guests feel welcome from the moment they arrive. A great way of doing this is to offer a welcome pack. It doesn't need to be expensive by any means and will immediately create a good impression. A welcome pack might include; a photocopy map of the local area showing your accommodation and some local attractions, a feedback form, a postcard (see above under advertising), and a little gift such a lollipop or a sample pack of hot chocolate.

Get to know your guests. By this we don't mean to find out the name of their relatives and favourite foods but rather; what is the main age bracket of your guests? what countries are they coming from? are the majority female or male or are you getting a 50/50 mix? Getting to know your guests will enable you to cater your accommodation towards their wants and needs. You might also realise that you need to do more to cater towards other groups, for example having a couple hair dryers available at reception for the girls, or adding a pool table for the social young travellers.

One simple way of determining the wants and needs of the backpackers using your accommodation is to use a survey. Ask for feedback from your guests and take their comments on board. A simple, short survey is a good way of hearing what needs improving at your hostel, many people won't feel comfortable saying it to your face. Place a box at reception (clearly marked) to collect the completed surveys.

Download Sample Backpacker Hostel Survey Feedback Form (178 KB)
This survey is ready for print on standard A4 paper. The last area is left blank so you can write in a warm, personalised thank you and information for your guests as to where to place the completed form. Simply print the form, write your information in the last box and photocopy.

The more your accommodation has to offer, the longer a backpacker is likely to stay. Backpackers often stay longer than other international tourists and their travel itinerary is often very flexible which is great news for your business. It's up to you and your staff to really sell your local area. Tell guests about all the great things there is to do in the area. You must have as much knowledge about the local tourism industry as possible. Make sure you get out and do the tourist activities yourself so you can offer informed recommendations. Talk to your accountant, a dolphin swim or a wine tour, can be a business expense.

Some simple additions to your accommodation could increase the length of stay of your guests. Offer a book exchange for rainy days, have a bookshelf clearly marked as a book exchange and pick up some secondhand books to start it. Foreign language books as well as books in english will be appreciated and easy to find at good secondhand bookstores. If you have a nice garden area then maybe add a hammock or two. Another great idea is having bicycles, along with locks and helmets available. You can choose whether there is a hire fee or not, but there should at least be a bond. Photocopy off some maps showing great cycle routes to destinations such as picnic spots and swimming areas. Bicycles need not be expensive to purchase, look out for secondhand bikes for sale at police auctions, your local newspaper or online.

Finally, check out the competition in your local area. See what other backpacker accommodation has to offer and try to incorporate the good features into your business. The more you can improve your hostel, the more you can improve your profits.


Melissa Evans
Melissa Evans

Melissa Evans lives in Sunny Nelson, New Zealand. She divides her time between being Creative Director at SunRoom Web Design Nelson, writing for KiwiWise and being a Mum to Sophia & Nicky. In her spare time she loves to travel, illustrate and read.

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  • Lara posted on April 26th, 2016
    Overall Rating: 10.0 / 10

    This was a great, informative article - many things I might have over looked. Thanx :)

  • Angrej posted on January 25th, 2011
    Overall Rating: 8.0 / 10

    We were a group of 6 people from Europe, stayed at Feel At Home Backpackers in Singapore. Amazing service in a small backpacker. The best part we found was the location and the Owner/Staff. Really friendly and always having a smile on their faces. This is what a good backpacker needs. Last but not the least, the price is very affordable compared to other Singapore Backpackers. We recommend Feel At Home Backpackers.

  • jade17 posted on September 23rd, 2009
    Overall Rating: 8.0 / 10

    Whilst back-packing around New Zealand for two months the main things I really appreciated apart from those listed in the review were enough space to put your food supplies (especially in the fridge) and someone to oversee that the kitchen had been left in a good state!! An added bonus at one hostel was free tea and coffee and herbs - this saved having to buy ridiculously small amounts of these items when travelling!

  • Wifey posted on October 23rd, 2008
    Overall Rating: 10.0 / 10

    I stayed at a great backpackers in Byron Bay, NSW, Australia a few years back and they offered a free pancake breakfast. The breakfast was only available for an hour, with one man flipping continuous pancakes. The pancakes were served with lemon and sugar at the table. I'm sure it was probably quite economical and we absolutely loved it...also an added bonus is your guests will get up early for the breakfast.