Architectural Lighting Market Size Analysis:

The Architectural Lighting Market Size was valued at USD 9.39 Billion in 2023 and is expected to reach USD 18.65 Billion by 2032 and grow at a CAGR of 7.96% over the forecast period 2024-2032. The Architectural Lighting market growth is built on the rising demand for energy-efficient lighting solutions, inspired by global concerns over sustainability and lowering energy consumption. The advancements in smart lighting systems further enhance efficiency and provide adaptability to Architectural Lighting projects.

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The aesthetic value of lighting is also highly considered in commercial and residential schemes. Lighting is increasingly being used as a visual effect, thus giving rise to colorful surroundings that are yet to be achieved in contemporary architectural designs. Incorporating lighting in BMS is also increasing demand as it allows complete lighting control while ensuring functionality and energy savings.

Technological breakthroughs, such as those of IoT-based solutions and wireless lighting systems, further broaden the spectrum of possibilities opened up by Architectural Lighting and thus enable highly customized and versatile design solutions. Moreover, the thrust of government efforts in terms of green building standards and energy saving are increasingly forcing businesses and homeowners to upgrade to modern lighting systems. All these combined ensure steady growth in the Architectural Lighting market in various applications and sectors.

By 2023, Light-Emitting Diode (LED) have account for about 60% of the overall lighting market in the United States. That indicates a huge shift from traditional incandescent and fluorescent lights to energy-efficient LED technology. More than 1.5 billion LED light sources were estimated to be in use by the end of 2023, primarily in residential and commercial as well as industrial space. Most estimates indicate that widespread deployment will conserve energy at a rate of close to 70-90% over the traditional incandescent bulbs; this will translate approximately to some saving of about 100 terawatt-hours annually from electricity usage. Further, it is envisioned that LEDs will avoid 75 Billion metric tons of greenhouse gas emissions in 2024.

Architectural Lighting Market Dynamics

Key Drivers:  

• Energy Efficiency Fuels Architectural Lighting Growth Due to LED Technology and Government Incentives Drive Market Expansion

Energy saving is becoming an increasingly contentious subject; what's more, because of environmental concerns about sustainability, and therefore the need for such illumination methods for their buildings, like LED lighting or other energy-saving technologies, ends. These bulbs consume much less energy; take less power; they have very long lives compared with the traditional ways of illuminating buildings. In addition to that, the costs of maintaining and running will be very low as well. The growing investment in low carbon footprints by businesses as well as consumers is accelerating the adoption of such energy-efficient solutions, thus growing markets faster. Governments as well as other bodies around the globe are providing incentives and regulations that help consumers utilize energy-efficient lighting, thereby expanding market growth.

• Smart Lighting Systems Revolutionize Architectural Lighting with IoT and Automation for Enhanced Control and Efficiency

Architectural Lighting no longer just serves the purpose of illumination but increasingly includes various advanced technologies such as IoT and automation. The big advantage of smart lighting systems is the ability to have control over light intensity, color, and timing from a distance or through automated schedules. This then increases both energy savings and the general experience of the user, making these appealing systems, especially for commercial and public buildings where lighting needs vary at different times of the day. A strong desire for customized and optimized lighting solutions is what pushes the adoption of smart solutions and is the key contributor to the market's growth. 

Restrain:

• High Upfront Costs Challenge Adoption of Advanced Lighting Systems in Smaller Businesses and Developing Regions

High-end lighting systems, especially the smart and connected variants, cost an arm and a leg up front. Even though economies realized in the long term are valuable, LED fixtures, IoT-enabled controls, and automated lighting systems present a cost that may be too steep for smaller businesses or residential consumers. In addition, the integration of new lighting systems into existing infrastructure complicates the process, with both the potential to create technical difficulties and higher installation costs. There is also the limitation of lesser knowledge and experience in using such advanced lighting technologies, which also hinders the technology from making itself more accessible to the masses, more so in developing regions where such traditional lighting systems are still within a budget.

Architectural Lighting Market Segmentation Overview

By Component

The ballasts segment in the Architectural Lighting market was dominant, capturing more than 18% of the share in 2023. It can be attributed to the widespread use of LED and fluorescent lighting systems in the architectural field, where ballasts are used for a smooth supply of electricity to control the functioning of different lighting combinations. Since these energy-efficient, durable, and low-maintenance lighting technologies have become popular these days, the adoption of compatible and high-performance ballasts will continue to boost this segment.

The lamps segment is expected to grow at a CAGR of 9.40% in the forecasted period. The growth will be witnessed on account of increased demand for both outdoor as well as indoor lighting solutions. Lamps are witnessing an increased demand along with several initiatives pursued by various governments to illuminate public places and ensure a comfortable environment for the masses. Market players are using a host of business strategies to expand their customer bases and secure their position in the market.

By Source

Light-emitting diode (LED) dominated the Architectural Lighting market with a remarkable lead of over 28% in 2023. Strong growth in the sector has been one of the major factors owing to the rapid advancement of LED technology. LEDs have become even more efficient, reliable, and versatile, improving brightness, color accuracy, and durability. LEDs have emerged as an alternative to the old-fashioned lighting solution traditional, saturated lighting of incandescent or fluorescent bulbs.

The High-Intensity Discharge (HID) segment is expected to grow by approximately 8.87% in terms of compound annual growth rate during the forecast period. High-intensity illumination is primarily in use with end-users, mostly being required to cover larger distances. Therefore, these lights are largely in demand within public areas and large halls, such as retail malls and sports arenas. 

By Application

The indoor segment had the largest market share above 76% of the Architectural Lighting market during 2023. Increasing population and continuous urbanization are creating more residential projects that are being undertaken worldwide, thus leading to healthy growth prospects for Architectural Lighting for different end-users, such as residential and commercial lighting, and also office lighting.

Outdoor would have a growth rate of CAGR 8.83% over the forecast period. The trend toward living outdoors attributes Architectural Lighting to outdoor application growth. Homeowners and developers invest in outdoor spaces, such as patios, gardens, and terraces, to create extensions of indoor living areas.

By End Use

The commercial segment accounted for the largest share 57% of the Architectural Lighting market mainly due to the rising need for energy-saving lighting solutions in offices, retail, and public buildings. In these environments, advanced lighting designs are highly demanding for improved aesthetics and functionality with energy saving.

The residential segment is estimated to grow at a CAGR of 9.38 %over the forecast period. Homeowners are turning their attention to improving their homes and smart lighting technology. This category continues to grow because consumers would be looking for comfort, and energy efficiency improvements in living spaces, thereby making residential Architectural Lighting an attractive choice.

Architectural Lighting Market Regional Analysis

Asia Pacific has the maximum market share of above 45% and is likely to hold its position till the end of the forecasting period. Increasing urbanization trends have been observed in the Asia Pacific region; Billions of inhabitants of rural settings have been shifting to cities with hopes of economic prosperity. For example, the World Bank has indicated that Asia-Pacific is experiencing fast growth in regards to the process of urbanization with an estimation that about 55 % of the population will reside in cities in the year 2030.

High urbanization rates are causing cities to grow and expand greatly, and with this development, the Asia Pacific Architectural Lighting market is experiencing an upward trend at a CAGR of 8.39% from 2024 to 2032. Architectural Lighting would be crucial for developing the cityscape and the attractive environment.

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Key Players in Architectural Lighting Market

Some of the major players in the Architectural Lighting Market are:

• Philips Lighting (Hue Smart Bulbs, Color Kinetics)

• Osram (LEDVANCE, Siteco)

• GE Lighting (C by GE, Reveal LED Bulbs)

• Acuity Brands (Lithonia Lighting, Gotham Lighting)

• Cree Lighting (Cree Edge, Cadiant Light Engine)

• Legrand (Wattstopper, Adorne)

• Focal Point (LyteFrame, Seem 2)

• Zumtobel Group (Tecto, SLOTLIGHT)

• Ketra (Ketra Luminaires, Control System)

• Signify (Interact, Philips Dynalite)

• Lutron (Caséta Wireless, RA2 Select)

• Selux (LUMEN, Light Columns)

• Holophane (Prismatic Lens Fixtures, LED Area Lights)

• Sylvania (Ultra LED, LED Wall Pack)

• Nimbus (Nimbus UFO, Q-LED)

• Eaton (Cooper Lighting, Halo LED Downlights)

• Meyer Lighting (LED Flex, Meyer Rigid LED)

• Cannonball Lighting (Cannonball Series, Beacon Series)

• Barn Light Electric (Gooseneck Lights, Vintage Outdoor Fixtures)

• Edge Lighting (Edge LED, LumaLine)

Recent Trends

• In August 2024, Häfele Expands Lighting Solutions with New Architectural Lighting Range, Introducing the Versatile Delft Series for Modern Interiors

• In March 2024, WAC Lighting showcased its innovative KONSTRUKT modular lighting system at LEDucation 2024, held on March 2024, in New York City. This system featured customizable, field-cuttable channels along with versatile lighting elements tailored for high-end commercial applications, emphasizing scalability and performance.

• In March 2024, The Light + Building event returned to Frankfurt, Germany. It attracted over 2,000 exhibitors, highlighting a strong recovery in the industry.