Commercial Lighting Market Size, Share & Trends Analysis Report By Type (Lamps, Luminaries), By Lighting Type (LED-based lighting, Traditional), By End-User (Commercial Offices, Retail, Hospitality and Leisure, Healthcare, Industrial), By Offering (Hardware, Software, Services), By Installation Type (New, Retrofit), By Application (Indoor Lighting, Outdoor Lighting) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global commercial lighting market size was valued at USD 11.46 billion in 2022. It is projected to reach USD 64.67 billion by 2031, growing at a CAGR of 5.80% during the forecast period (2023-2031). 

Commercial lighting can be adapted to the needs of any building or operation. Considerations such as warranty length, lumen output, and frequency of maintenance are essential for commercial lighting purchases. A commercial structure can host many people for various uses, including shopping, employment, entertainment, and medical examinations. A lighting design company creates designs that reflect the facility's activity to ensure that workers are comfortable and that the lux level requirements and the energy efficiency criteria are adequate. Light fixtures' use, characteristics, and purpose must be considered while designing business lighting.

Market Dynamics

Global Commercial Lighting Market Drivers

Smart Office Initiatives and Awareness Support Energy-Efficient and Connected Lighting Solutions

LEDs are more dependable and efficient and have a longer lifespan. As a result, their use is anticipated to grow in indoor and outdoor settings. These lights are more economical than incandescent ones, offering about 50,000 hours of illumination for a small amount of energy. Because of their low operating costs and reduced heat losses, they are also an excellent alternative to incandescent lights. In addition, technological advancements have improved energy-efficiency regulations, the switch from conventional to green lighting, and product demand. High-efficiency lighting solutions can use up to 85% less energy than traditional lighting technologies while providing light that is at least as good.

Global Commercial Lighting Market Restraint

Construction Activity and other Conditions Impact the Sector

For real estate managers looking to upgrade new or existing buildings with high-quality LED lighting, LED lighting plays a crucial or significant role. The two main types of LED lighting are retrofit LEDs and LED light fixtures. The existing lighting fixtures are utilized when using retrofit LEDs, whether through straightforward screw-in replacements or retrofit kits that slot into position. On the other hand, LED fixtures are brand-new lighting fixtures created and produced using LED technology and may be utilized to replace existing lighting options. Any real estate or construction industry disruption will negatively affect lighting solutions globally.

For instance, the COVID-19 epidemic has negatively impacted the building industry worldwide and caused countless projects to be canceled. The scenario generally makes the building industry anxious, worried, and restless. As a result, almost all countries have gone through a financial recession in the construction sector, negatively impacting the lighting industry.

Global Commercial Lighting Market Opportunities

Standardized LED-based Lighting Solutions and Sector Technological Advances

In the current market, LED light bulbs are in the early adoption stage of their product life cycle. These product offers are prepared to enter and move through the growth phase as LED lighting technology develops. Due to recent developments in light-emitting diode technology, LED lighting products have entered the commercial lighting market and have a very high growth potential. Over a quarter of the energy used in the United States is consumed by commercial buildings, which include offices, retail establishments, restaurants, and hospitals. The top American manufacturers are also actively expanding the LED lighting market due to the growing penetration rate of LED lighting.

The market for LED commercial lighting in the US is thriving, with demand for troffer, panel, tunnel, and high bay lights expanding faster. Among other new application areas, they are starting to develop into intelligence and optical communications. For instance, Technical Consumer Products Inc. offers a commercial recessed downlight that can be adjusted for wattage and color temperature to fit a variety of retail settings.

Regional Analysis

The global commercial lighting market is divided into four regions: North America, Europe, Asia-Pacific, and LAMEA. 

Asia-Pacific Dominates the Global Market

Asia-Pacific is the most significant revenue contributor and is expected to grow at a CAGR of 6.35% during the forecast period. Products for lighting are crucial for infrastructure, daily living, and industry. The mainland's need for illumination is growing along with China's economy and rising standards of living. China has been the world's top producer and consumer of lighting in the last 20 years due to the lighting industry's rapid development at that time. Significant products include organic light-emitting diodes, compact fluorescent lamps, electrodeless discharge lamps, and light-emitting diodes (LEDs) (OLEDs). Commercial businesses in China are investing more money in lighting retail centers to draw customers. Office, school, and hospital lighting have all significantly improved. China has been pushing energy efficiency and environmental preservation.

North America is expected to boost at a CAGR of 4.75% during the forecast period. In North America, the use of LED lighting in commercial settings is rising. More excellent lumen coverage increases durability, and the proper power source is required for the retail market. LED meets these necessary conditions. As a result, it is favored over other light technologies now in use. It saves more electricity, covers a larger area, has more than 100,000 lumens, and is relatively inexpensive to acquire and operate over the long run. One of the main factors driving the adoption of LED lighting in the United States is the rising demand for energy-efficient lighting systems, which is being met by falling prices for LED goods and strict government restrictions. As a new source of illumination in the nation, LEDs have experienced tremendous technological and economic development, spurring investment in the industry.

The UK commercial lighting industry is anticipated to expand steadily in the upcoming years. In the UK, there is expected to be considerable demand for LED in commercial settings. LED lights create light more effectively than conventional light bulbs, which include fluorescent and incandescent bulbs. The availability of new solutions due to ongoing technological development drives the demand for LED lighting in business settings. The LED lighting market's expansion is facilitated by rapid urbanization and a spike in construction activities for the growth of commercial sectors. The introduction of LED lighting is anticipated to increase building energy efficiency, which will address current energy issues, reduce electricity costs, and ease demand on the existing infrastructure.

Brazil has made enormous efforts to increase the energy efficiency of the lighting sector as the largest energy consumer in Latin America. The government's emphasis on energy-efficient lighting solutions is vital in propelling the nation's LED lighting market. In its national policy framework, for instance, the government promised to boost energy efficiency by 10% by 2030. The development of the construction sector, rising government spending on installing LED lighting in public spaces, and raising awareness of energy conservation have all contributed to the growth of the commercial lighting market in the Middle East and Africa. Government initiatives to concentrate on electrifying commercial areas in the MEA region and eradicating traditional lighting products, such as incandescent light bulbs incandescent lamps, to install LED-based lighting products are the main factors fueling the growth of LED lighting in the region during the forecast period.

Segmental Analysis

The global commercial lighting market is segmented by type, lighting type, and end-user industry.

The global market is bifurcated based on type into lamps and luminaries.

The luminaries segment is the highest contributor to the market and is estimated to grow at a CAGR of 5.45% during the forecast period. Luminaires are frequently utilized in the commercial lighting industry to illuminate vast regions. Luminaires cost more than regular LED bulbs do. Luminaires, including downlights, floor lamps, troffers, and pendant lights, are offered for different applications. Fixtures allow optical designers to use light more effectively since they produce more light per unit of power, are simpler to control, and illuminate a large area with fewer lumens. The primary factors anticipated to drive the market dynamics for lighting fixtures and luminaires until 2026 are the rapid development of smart cities and the soaring need for sustainable, energy-efficient, intelligent lighting solutions. For instance, the Smart City Center of Excellence's lighting solutions vendor, Schréder Hyperion, developed a line of innovative luminaires with intelligent drivers known as the ZD4i series specifically for IoT systems. 

The lamps are offered in all light sources, including high-pressure and low-pressure sodium vapor, incandescent, tungsten-halogen, fluorescent, compact fluorescent, mercury vapor, metal halide, and led lamps. A conventional filament bulb is made up of a filament that acts as an electrical conductor and emits light when current flows through it. They can be divided into incandescent and halogen lamps. Halogen gas is used in halogen lights to extend their rated lifespan and light output. The market has shifted favor of LED light bulbs by delivering low-energy ambient light, even though these light sources are outmoded. Compared to standard incandescent bulbs, they offer more excellent rated life, light quality, and energy efficiency.

Based on lighting type, the global market is bifurcated into LED-based lighting and traditional.

The LED-based lighting segment is the highest contributor to the market and is estimated to boost at a CAGR of 7.10% during the forecast period. A semiconductor light source known as an LED, or light-emitting diode, transforms electrical energy into light energy. There has been an increase in demand for LED lighting in recent years due to rising environmental degradation and energy issues. This kind of illumination is both affordable and reliable. It provides a variety of advantages over incandescent lights, including high reliability, brightness, compact size, and extended life term, all of which are expected to support revenue growth. As a result, it is projected that the market demand for commercial LED lighting will grow even more in the upcoming years. The expansion of this market can be attributed to LEDs' broadening applications, low price points, and long lifespan. LEDs provide brighter light with reduced electricity use.

The classic illumination options are HID, CFL, fluorescent, and incandescent light bulbs. The incandescent bulb was the most traditional and old-fashioned of all the light bulbs. It generates light by heating a wire filament to a temperature where light is produced. A translucent glass bulb either evacuated or filled with inert gas encircles the metal wire. In addition, HID lamps generate light by an electric arc between tungsten electrodes inside a fused quartz or fused aluminum oxide arc tube that is translucent or transparent. Helium, neon, argon, krypton, and xenon are among the tube's noble gases, which are also frequently filled with metal or metal salts. The arc's first strike is made possible by the noble gas. 

Based on the end-user industry, the global market is bifurcated into commercial offices, retail, hospitality and leisure (restaurants and sporting facilities), healthcare, and other end-users.

The commercial office segment owns the highest market and is estimated to boost at a CAGR of 6.35% during the forecast period. Commercial office lighting is one of the work environment's most frequently disregarded and undervalued elements. One of the best investments that offices can make is selecting the appropriate office lighting fixtures. It can influence not only employee output and morale but also the building's security and general client satisfaction. Commercial office lighting is frequently utilized in public spaces, including offices, hospitals, retail establishments, and educational institutions. Commercial-grade lighting is robust and may use cutting-edge technologies to boost efficiency and user-friendliness. Office lighting can influence visitors' and employees' moods, improve productivity, and improve the aesthetic attractiveness of the area. 

Building a successful retail business requires creating an inviting visual environment for clothing, groceries, and other retail products. Products for commercial lighting play a significant role in this process. But a principal amount of the electricity cost in retail establishments is frequently made up of lighting energy use. Retailers used to rely on halogen and incandescent bulbs to provide displays with a cozy, welcoming glow. These sources rendered reds strongly and faded well. Even though lighting emitting diode (LED) goods significantly reduced energy consumption, there was sometimes hesitation in switching because of concerns that LEDs could produce a different lighting level. Several lights are now available ready to service visually demanding retail environments while using less energy than was previously needed to appropriately and strategically illuminate retail areas due to technological advancements over the past few years.

Hospitality is essential to make the ideal setting and mood and transfer the clients to ease. The atmosphere of a hospitality room at a hotel, restaurant, or resort must be warm and charming to provide guests with an exceptional experience. A crucial factor in this process is lighting. Lighting serves the practical purpose of beautifying and illuminating an area and producing the appropriate mood and spectacle. To create visually appealing and functional interiors, lighting in hospitality areas also requires a layered approach with ambient illumination, task, and focus lights. Despite the abundance of energy-efficient lighting options on the market, LED is set to take over as the standard for hotel lighting. They are becoming smaller and brighter while using less electricity due to design advances. 

Theme and amusement parks have long been well-liked because these places continually provide what customers want: distinctive entertainment options that astound, amuse, and mystify visitors worldwide and make memories that will last a lifetime. These parks frequently feature extravagant spectacular shows that are drawn to the illumination. As a result, lighting in these theme and amusement parks aids in increasing visitor numbers. To create large, vivid, and bold displays, park operators and designers take advantage of vital lighting fixtures’ scale. Robust lighting solutions' unmatched dependability guarantees that viewers won't be let down night after night but rather astounded by the stunning visual effects of the fixtures' intense lighting and the accompanying ensemble of cutting-edge technologies. Strong lighting devices have served various purposes in this context thanks to their adaptability, including simple character illumination, broad field illumination, and aerial effects.

Recent Developments

• June 2022- A new business unit combining Commercial Lighting and Seating solutions was established, according to Wipro Lighting. The company claims that by utilizing Wipro's shared dealership network and customer servicing, the new organization will enable more significant synergies and accelerate growth.
• February 2022- A significant participant in the lighting industry named Signify announced that it had signed a binding contract to buy the Australian company Gerard Lighting Group's Pierlite division. By joining forces, Signify would be better positioned to take advantage of growth prospects in the Australian and New Zealand lighting markets, especially between Pierlite's portfolio of luminaires and Signify's connected lighting solutions.