Travellers have reservations about Hostelworld
Hostelworld, the hotel-focused online booking platform, has reported a drop in revenue for the first half of this year, as summer appetite from holiday-goers disappointed.
Revenues tumbled from €42.6m (£39m) in the first half of 2018 to €38.8m during the first six months of 2019.
Gross bookings for the company fell by four per cent, as Gary Morrison, chief executive, cited “lower than anticipated demand over the summer period”.
Morrison claimed the nine per cent reduction in revenue was a result of “higher than anticipated inflation” and the “full global roll out of the free cancellation product”, which led to its number of cancellations reaching 250,000.
Speaking to City A.M., he said 2019 should be regarded as a “transition year”, with improvements in the company’s booking experience likely “to bear fruit” by 2020.
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The company today also announced its $3m strategic investment in Tipi Pty – a technology solutions company exclusive to the hostel market that allows guests to check-in and download their keys prior to arrival – in a bid to make the company more attractive and reverse the decline in their bookings.
As a consequence of these results, a report by Numis stated that “to be cautious”, it “now assumes only three per cent booking growth”, down from six per cent for the year 2020.
The company believes its ‘Roadmap for Growth’ “is progressing well”, as bookings on the Hostelworld app grew by seven per cent to 43 per cent of net bookings.
Main image credit: Hostelworld