The Hotel-Hostel Joint Business Model
Prague Mosaic House
When Mosaic House opened in 2010 I thought all common sense had gone out of the window. I visited shortly after it opened and was mightily impressed by the hostel facilities but was then shocked to find that in the same building they were offering 4 star accommodation. I was concerned that 4 star clientele would not want to be exposed to a hostel crowd. I wished them well with their hotel-hostel model.
Then in 2014, the Fusion Hotel opened. I visited there as well and I got a real feeling of Deja Vu. Chic bar, separate restaurant, dormitory and 4 star accommodation albeit less space for the hostel side than the Mosaic House and there are room design differences but the hotel-hostel business plans look the same.
Of course the business plans will call for the separate facilities for revenue generation. Fusion is more central, has a nice restaurant and has a great cocktail bar but it’s not walk-in. Mosaic House has an equally good bar, a different restaurant style and an event room. Both do special events so pretty equally matched but I was interested in how 4 star clientele and hostel clientele get on so I visited both and decided to find out.
The results were quite fascinating. I found about twenty people at both places and the split was about 70-30 in favour of the 4 star people. It was apparent that the 4 star people who went to the Mosaic House were aware of the hostel accommodation on-site and chose to stay here either because they were “young at heart” (their own words) or had a good deal. 4 star people who went to Fusion did so by searching for a “design hotel” and were almost all unaware that dormitory accommodation existed on the site. For the hostel goers, Mosaic House was the first choice by word of mouth for the “atmosphere”. They viewed it as a hostel that had “some older people in it” and really had no knowledge of the 4 star rooms. Fusion had the young people looking for a “central location” and a “safe and secure” dorm and went by price rather than the overall facilities.
So all in all, I liked the fact that people looking for a 4 star room specifically chose Mosaic House in full knowledge that it was also a hostel but it did show that the majority of both groups of people were blissfully unaware of the other when booking so I thought there maybe some mileage in a hotel-hostel model.
2016 edit: The Hotel-Hostel dilemma. Following the demise of the old Unitas hostel, Fusion is now in the process of rebranding to remove the hostel facilities to allow it to be listed as a 4 star hotel. Apparently, if you have this mixed hotel-hostel model and i.e. dorms mixed with higher standard accommodation then you are not eligible for a star rating.
2018 edit. Fusion closed and has reopened as the four star Hotel NYX.
Find out more about Mosaic House
Find out more about Hotel NYX