Tip #1: Don't assume hostels are cheaper than hotels
When we first started traveling, we were guilty of this. Hostels are cheap, right? Well, yes and no. If you're cool with a room full of strangers in bunk beds and a shared bathroom, then yes. They are very economical and most of the time, not that bad. You meet people, it's a very informal, kumbaya type set up, and it'll suit you just fine if you can ignore common areas that haven't been thoroughly cleaned in ages.
But if you, like us, have outgrown your dormitory hostel phase and want to stay in a private room? Hostels are almost always more expensive.
Yep, not lying. Most European hostels charge you for a double room per person, and oftentimes it's $50-60 a person, so you end up paying $100 or more a night. For a hostel. Guess what kind of hotel you can get for $100 a night?
Which leads me to the next tip...
Tip #2: Do your hotel homework
When looking for hotels, I like to start with a website like Hotels.com. I like them because they offer a reward club where if you stay 10 nights, you get one free. Since we travel a lot, this is a pretty sweet deal for us. Not only that, but their prices are usually the lowest I've seen. Shop around booking websites and find one you like.
While searching, I care mostly about location and price. Is it near the sights? Is it near the train station or airport if I need to use them? Is it safe? I can organize them by their distance from the city center or major sights and then organize them by price. Usually we try to stay around $50-60 a night, and that gets us a decent hotel (usually 2 or 3 stars) with free wifi and (sometimes) free breakfast.
Once you've made some selections, look up the hotels on TripAdvisor. What're people saying? Are they minor complaints like "room was small" "breakfast was boring" or are they big ones like "ceiling leaked", "bedbugs", or "hotel manager actually deranged murderer operating illegal organ harvesting in basement"? Hotel pictures can be misleading, and prices can be enticing. Check out what other people have said before you click "buy"!
Tip #3: Understand that things differ from country to country
Be flexible. Just because you got a free breakfast in Prague doesn't mean you'll get one in Barcelona. Good wifi is not as ubiquitous in Europe as it is in the US. Rome and Paris can be flippin' expensive for the crappiest of rooms.
In Latvia we got an amazing hotel room smack dab in the city center. In Liechtenstein we stayed waaaaaaaaaaay far away from anything remotely cool. Both for the same price. Take country differences into consideration and remember, you're only there for a little bit. You can tough it out for a weekend!
Unless they charge you for wifi. Cause that's just mean, dude.
Tip #4: Branch out.
Maybe you're having trouble finding somewhere to stay. Too expensive, too generic, too limited. In that case, think about branching out to B&Bs, apartment stays, or in Germany, Jugendherberges. Sometimes these options are a little more difficult because you have to deal with a language barrier-how can you request availability via email when the owner only speaks German? Look into it though, and bust out google translate-you can save money this way.
In Marburg and in Wittenberg we stayed in Jugendherberges. They're youth hostels, but in the scrubbed government owned sense, rather than the cool, hippy ones you usually find. They're geared towards big groups and families with kids. You need to be a member to stay, but it's easy and cheap to become one (around 12 euro). You make your own bed, but breakfast is included and lunch and dinner can be bought at the "mensa" style cafeteria in the building. This was a good option for us, but be aware: like most hostels, it's more expensive for a double room.
B&Bs, apartments, and the like can be a really cool experience and often put you right in the city center. Some places can be booked online but others you have to call to reserve. Look into it!
Another option? Stay in a neighboring town that's connected by train or bus to your destination. While visiting Venice we stayed in Padova and got 2 Italian city experiences out of one trip. Padova was such a nice change from the chaos of summertime Venice, and a lot cheaper to boot!
Tip #5: Don't knock the brand name...or use it exclusively.
Some people get all militant about staying in something "authentic", but when I'm looking for hotels my cheapness takes over and I only care about getting the most bang for my buck. In a lot of European places we've been, the Best Westerns and Holiday Inns have been very upscale and sometimes out of our price range. However, we have stayed at them a few times when the price was right, and guess what? We didn't get demoted points for being uncool, "conformist" travelers.
The point of lodging during your travels is a place to sleep and shower, right? Pick what you want.
However, don't think that because you know the brand name, it'll be better. Do your homework and look for alternate options before you go with the familiar.
Those are my hotel tips! They have saved us money and I hope they'll help you too!