Dorms.com is Taking Hostel Concerns to Heart
The hostel Online Travel Agent (OTA) space has been seeing some drastic changes over the past couple of years, proving itself time and time again to be one of the toughest markets to exist in, let alone build a new business. Well, Dorms.com has done just that and has already sold over 1 Million beds, with some big plans to help both you and your guests. Their business model comes from a different perspective, and we reached out to their founder, Chris Morisseau, MBA, to best explain them.
What is Dorms.com?
Dorms.com is a hostel booking site built with backpackers in mind. We focus exclusively on hostels with dorms and private rooms, and it’s important to us that hostel owners have a platform to properly promote their value proposition against all the players in the accommodation industry. We know that hostels offer a variety of benefits that hotels and short-term apartments can’t match, and we’re here to showcase those perks. For us, matching a guest with the perfect hostel is the ultimate win-win situation.
What made you want to create Dorms.com?
Dorms.com aims to provide true value to hostel owners. Every hostel in the world creates its own experience, which tends to be quite unique (especially compared to budget hotels, which are fairly consistent). Hostels need a special way to showcase those experiences. Booking.com, the current leader in hostel bookings, isn’t a hostel-specific booking site. Sites like Booking.com and Expedia still have technology geared towards the needs of hotels and other high ADR accommodations. Brands like Hostelworld are a little more specialized but are not limited only to hostels. They may have more hostel-specific features across their brands but struggle to keep up against deep-pocketed competition from the hotel booking giants. We see a need for hostels to market and express themselves individually, and that is where Dorms.com can help. We also recognize the value of the multinational nature of hostel travelers. Our platform allows hostel owners to showcase their properties in the best possible light in thirteen different languages. We have been operating as a group of white-label booking sites for 10 years and have expanded to 15 domains and 13 languages. We’re proud to say we’ve sold more than 1,000,000 hostel beds. We’re confident that’s sufficient for market evaluation, and we’re setting up our own backend to add more value for both the guest and the hostel.
How is Dorms.com different?
Like we said, we want to create a site where diverse hostels with different business models can freely experiment and seek out the right guests. We shoulder the pain and hassle of marketing and managing bookings, allowing them to focus on running their business. We do this by offering hostels the ability to:
Make guaranteed revenue and bookings, with prepaid non-refundable rates at the time of booking
Set up “Book now and pay later” rates with a 0% deposit
Showcase more details on facilities and amenities, helping bookers make more confident decisions
Increase value and be flexible in yield management through custom rate plans and special offers
And to top that off, we have superb customer service in multiple languages, a multinational focus, the ability for hostels to comment on reviews, and we push for a strong focus on the social values of hostels, all without hotels and apartments getting in the way.
That’s quite a list. I’d love to talk about them all, but first, how about the payments? Do you own the payments?
Yes, but don’t worry, we’re committed to passing payments along in a timely manner. We have partnered with Hyperwallet payment services to send funds to property owners on a weekly basis, so hostel owners can receive their funds faster and easier around the world.
So, do you own all transactions then?
No. We handle every transaction that takes place prior to the guest arriving at your hostel, including no-shows for times when your guests don’t arrive. Hostels can set up policies that can both grow a healthy business and incentivize guests along the way.
When will hostels see their money? Is it the same for everyone?
It’s simple: Hostel owners are in total control. For each room type on any given day, they can set up their own deposits, milestones, late cancellations, and no-show fees.
And we can set multiple rates?
Yes, you can set up to 20 different rates. Rates and promotions are huge in the hotel sector, and hostels just haven’t caught on. We’re here to change that. Each rate will have the ability to have its own payment policy. This way, you can really tweak what you're offering. You can set up non-refundable rates that work great for advance purchase deals and groups, with the ability to add milestone payments for groups or long reservations to guarantee your revenue. You can also automatically adjust the price or add value for longer stays, specific group sizes, and inventory counts, including last-minute deals. To top it all off, the rates can be applied automatically within specific dates or date ranges to encourage certain booking behaviors. The possibilities are endless. We really look forward to seeing what hostels will be offering and what guests will be buying.
That sounds like a lot to manage; do you work with any channel managers?
We have partnered with the top channel managers and property management systems. We know some of them do not have the fancy rate integration capabilities that expensive hotels do, but fear not. You can set a rate to be a child rate of another (usually the standard) so the inventory and price will always be optimized. We even have an “auto stop sell” threshold for the rates to help when your availability is limited. Sorry to get back to rates; we’re just really excited. As for integrations, we work with… We plan on adding many more based on our hostel owners’ feedback.
Have you had any traction?
As mentioned before, we have had over 1 million bookings and we’re getting many new signups for our own simple and accommodating extranet. As they join, we find ourselves observing, working out some kinks, and determining what changes to make to add even more value as we go along.
So who can sign up?
We have been in the testing phase with a few of our key partners, cleaning out the bugs rather efficiently. Now we’ve opened up to everyone, but we’re taking our time to work with each new customer, getting to know them while receiving some valuable feedback. You can sign up to be one of the first on our extranet when it becomes available. To do so, click here.
Ok, so we sign up, how do you get us more customers?
We have already sent our current customers over 1 million guests, so we feel confident we can deliver there. We believe our focus on hostel guests provides more value as we strive to exceed expectations. Other sites can send you guests who might not fit the mold, while we send you true backpackers who will spend more $$ on activities, in bars, and contribute to the social element of the hostel. We see that as a strong foundation on which to build. We use our multi-language approach to reach diverse markets, and we believe that the more hostels take advantage of our special rate capabilities, the more control they get. We intend to offer some of the most competitive deals out there. In addition, we charge lower commission rates than the market leaders and have incentives in place that encourage hostels to thrive. We are adding value to you and your guests. We want you to use this value in the best way possible, which compounds the value we offer to the guests. It’s simple: Find the right guests, get them to the hostel, encourage them to tell their friends, and keep coming back to your hostel and Dorms.com.
Did I hear lower commission? What is the rate?
We offer commission rates at or lower than what you’re already used to. We are starting off with two levels of partnerships to further motivate our partners and boost performance. Through these levels, we’re basically offering faster money and lower commission to those who perform best with us. We also understand how the major hotel sites strike deals with the major hotel brands, who often pay less than their independent counterparts, and we do not want to create an unfair environment like that. To us, performance is relative and will be based on each hostel’s facilities and locations. This will help give everyone a fair chance in such a fragmented industry. Everyone joins as a “Silver Partner,” and if their performance meets the requirements, they will have the option to become “Gold Partners” later on. Right now, there is an absurdly low commission rate for those signing up to persuade new partners to become competitive.
What’s in store for the future?
Our next focus, aside from making everything mobile-friendly, is capturing the full experience to be showcased on our site. We will dive more into the social capability and help hostels define how their product is unique compared to other hostels, as well as how the hostel industry is unique compared to the accommodation industry as a whole.
How can we help?
You can help by sharing our story. If you own or manage a hostel, you can sign up and talk to your guests who use our site. We’re open to feedback and appreciate it all. We look forward to developing relationships with many hostel owners and operators out there, so if you see us at a trade show, feel free to stop by and say hi.
DISCLAIMER: Dorms.com is one of our advertising partners, and the HostelTrends team has been assisting the Dorms.com team in many ways to help them achieve their goals.