Tourists in Kelowna, B.C., spending carefully, opting for experiences

While beaches may be packed with sun-kissed tourists, many businesses in Kelowna, B.C., have reported a decrease in spending this summer.

“We know visitors are coming,” Lisanne Ballantyne, the CEO of Tourism Kelowna, said in an interview after tourism data for the second quarter of the year – which spans from May to June – was released.

“The challenge is how they spend their money once they’re here has been changing.”

WATCH | Changing consumer habits reflected in Kelowna’s tourism industry:

Okanagan tourism operators bounce back after years of slump due to wildfires

After years of wildfires and smoky skies in the Okanagan, tourism operators are enjoying a bounce-back summer with decent weather during key tourism months. That’s contributed to an overall increase in visitors and hotel stays in Kelowna, B.C. But as Brady Strachan reports, some in the industry say visitors have less money to spend during their stay.

In Kelowna, a town known for hot summers and tourist-focused amenities, local businesses were hopeful that a successful season would cushion the blow of previous years stymied by COVID-19 mandates, heat domes, and wildfires.

As anticipated, when the weather warmed, visitors flocked to the Okanagan to enjoy the smoke-free skies and sun.

However, despite the surge in tourists, some businesses are not making the profits they had hoped for. This year, visitors have less disposable income says Ballantyne. In an economy coloured, by inflation, a trade war and an evolving relationship between the United States and Canada, tourist spending habits have changed.

“Picture a family coming to town and instead of spending four nights in a sit-down restaurant, they’re grabbing sandwiches to go, they’re having free picnics on the beach. They’re doing things that really stretch out the dollar for the whole week,” Ballantyne said.

Compared to 2024, Kelowna’s International Airport saw an increased number of passengers in second quarter of the year, likely indicative of increased visitor numbers, according to Tourism Kelowna.

Additionally, the organization found the city’s hotels, motels, resorts and short-term rentals also saw an increase in occupancy rates over the same period.

While the completed data for the summer has not yet been compiled, Tourism Kelowna suspects the region saw an increase in domestic travellers as fewer Canadians spent time south of the border, in line with national reports by Statistics Canada.

Tourism Kelowna’s adjusted data for estimated visitor spending shows a year-over-year decrease of six per cent in the second quarter, attributed primarily to a drop in recreation and entertainment industries.

Ballantyne added that Kelowna residents are also spending less — and their absence is felt in local restaurants. 

She said while some businesses, like fast food joints, are thriving with the increase in cost-conscious travellers, others are feeling the impact of tighter household budgets.

Luke Weller, the owner of Okanagan Parasail, said his business’s busy, record-breaking start to the summer on the lake subsided in July. Over the last two months he has noticed fewer people out shopping and enjoying the city’s downtown core compared to previous years.

“I believe one contributing factor may be the sharp increase in hotel rates,” Weller said. “Maybe they are spending all the money on accommodation.”

From April to June, the average daily rate for hotel, motel and resort rooms increased by 5.6 per cent, compared to last year, reports Tourism Kelowna. 

Immersive experiences

Even if people are trying to save money, they haven’t cut out ice cream, say staff at Parlour, an ice cream shop in downtown Kelowna. 

“Our sales are the highest they’ve been,” said manager Riley Schlackl. “We can tell that things have picked up, things are getting busier. We beat our own personal record comparing to previous summers.”

Over its eight years in business, the shop saw a decrease during COVID, but has otherwise been increasingly busy.

Schlackl said Parlour has made an effort to be the go-to shop in an economy where people are increasingly selective about where they spend their money, trying to elevate the specialty ice cream from treat to experience.

Ballantyne said across the country, consumer priorities have shifted toward placing an emphasis on immersive experiences over the last few years.

The changes in consumer spending is also felt by the liquor industry with an overall decrease in alcohol sales reported across the province from April to June compared to last year.

Off the beaten path, in the hills north of Kelowna, John and Sharon Molund own and operate Okanagan Stables and spend their summers taking groups from around the world on horseback trail rides. 

“It’s been about as busy as we want it to be. The season’s gone very, very well,” said John Molund. “We’re turning away business.”

Molund said this year, the weather has been perfect for tourism: not too hot with clear skies.