North America Smart Lighting Market

North America Smart Lighting Market Size

The North America Smart Lighting Market Size was valued at USD 6.3 billion in 2024. The North America Smart Lighting Market size is expected to have 14.67 % CAGR from 2025 to 2033 and be worth USD 21.60 billion by 2033 from USD 7.22 billion in 2025.

Smart lighting represents a cutting-edge evolution in illumination technology, combining energy-efficient fixtures with advanced features such as wireless connectivity, motion sensors, and adaptive controls. These systems are engineered to adjust automatically based on factors like room occupancy, ambient light levels, and user-defined schedules that is offering both convenience and significant energy savings. In North America, smart lighting has gained substantial traction and is becoming a key component of the Internet of Things (IoT) landscape. The region's rapid adoption is fueled by escalating energy expenses, growing environmental consciousness, and ongoing innovations in connected devices.

The market's expansion is evident across both residential and commercial spaces, with smart lighting being integrated into everything from individual homes to sprawling urban infrastructures. Recent years have seen a notable drop in the cost of smart lighting hardware, alongside seamless compatibility with popular smart home platforms like Amazon Alexa, Google Home, and Apple HomeKit. This affordability and ease of use have accelerated consumer interest. Furthermore, advancements in artificial intelligence and machine learning have unlocked new possibilities, enabling features like predictive analytics and tailored lighting solutions. The U.S. Department of Energy notes that lighting constitutes roughly 10% of the nation’s electricity usage, showcasing the transformative potential of smart lighting in reducing energy demands. Research from the National Renewable Energy Laboratory also shows that implementing smart lighting in commercial settings can cut energy consumption by as much as 70%. Beyond efficiency, optimized lighting environments have been linked to improved mental health and productivity, according to findings published by Harvard University, which emphasize the role of well-designed lighting in regulating human circadian rhythms. Collectively, these trends position North America at the forefront of the global shift toward smarter, more sustainable lighting solutions.

MARKET DRIVERS

Increasing Focus on Energy Conservation

The growing emphasis on energy conservation is a pivotal factor driving the North America smart lighting market. Lighting alone accounts for nearly 10% of electricity usage in the United States, as noted by the U.S. Department of Energy. Smart lighting systems offer a transformative solution, with the potential to cut energy consumption by up to 70% in commercial spaces, according to findings from the National Renewable Energy Laboratory. This has led businesses and homeowners to embrace these systems as a means to reduce utility expenses while supporting environmental sustainability. Government initiatives are also playing a critical role, with regulations such as California’s Title 24 mandating the use of advanced lighting controls. Additionally, the Energy Information Administration reports that electricity prices have risen by an average of 5% annually over the past decade, further amplifying the appeal of energy-efficient technologies. These factors jointly drive the adoption of smart lighting as a practical and eco-friendly choice.

Expansion of Smart Home Infrastructure

The rapid expansion of smart home infrastructure is another key driver propelling the smart lighting market in North America. By 2025, it is projected that over 50 million households in the U.S. will adopt smart home technologies, as per data. Smart lighting systems, which integrate seamlessly with platforms like Amazon Alexa, Google Home, and Apple HomeKit, are among the most popular devices due to their ease of use and versatility. Research conducted by Parks Associates indicates that nearly 30% of smart home users prioritize lighting solutions because they provide immediate value and enhance daily convenience. Furthermore, the cost of smart bulbs has decreased significantly, with prices dropping by approximately 40% over the past five years is making them more accessible to a broader audience. This synergy between smart lighting and connected ecosystems is fueling widespread adoption across the region.

MARKET RESTRAINTS

High Costs Associated with Initial Setup

A major obstacle hindering the growth of the smart lighting market in North America is the significant expense involved in the initial setup. While these systems deliver long-term savings, the upfront costs can be prohibitive for many consumers. According to the Consumer Technology Association, the average expenditure for installing a basic smart lighting system ranges from 150 to 300 per household, excluding professional installation fees. This financial barrier is particularly pronounced among low- and middle-income families, where discretionary spending on non-essential upgrades is limited. The National Bureau of Economic Research states that only 20% of households earning less than $50,000 annually are likely to invest in smart home technologies. Besides these, retrofitting older homes with smart lighting often requires additional expenses, such as wiring upgrades or compatibility adapters. These high costs can discourage potential buyers are impeding broader market adoption despite the technology's advantages.

Growing Concerns About Cybersecurity Risks

Another significant restraint for the North America smart lighting market is the rising apprehension about cybersecurity risks. Smart lighting systems rely heavily on internet connectivity is making them susceptible to hacking and unauthorized access. A study by NortonLifeLock reveals that nearly 60% of U.S. consumers express concerns about the security of IoT devices including smart lighting systems. Instances of cyberattacks and data breaches have raised alarms among users, particularly since these systems often collect sensitive information about user habits and preferences. The Federal Trade Commission has identified inadequate encryption protocols in many IoT devices are leaving them vulnerable to exploitation. Moreover, a survey by Pew Research Center found that 45% of Americans are hesitant to adopt connected devices due to fears of surveillance or misuse of personal data. The absence of standardized regulations governing IoT security further exacerbates these concerns undermining consumer confidence in smart lighting technologies.

MARKET OPPORTUNITIES

Smart Lighting as a Pillar of Urban Sustainability

The role of smart lighting in advancing urban sustainability initiatives presents a significant growth avenue for the North America smart lighting market. Cities across the region are increasingly prioritizing green infrastructure, with smart lighting systems emerging as a cornerstone of these efforts. The International Data Corporation estimates that spending on smart city technologies in North America will exceed $30 billion by 2025, driven by projects aimed at reducing carbon footprints and enhancing resource efficiency. For example, New York City’s implementation of smart streetlights has resulted in a 50% reduction in energy usage, according to the NYC Department of Transportation. These systems not only optimize energy consumption but also support broader applications like traffic flow monitoring and emergency response coordination. As municipalities strive to meet ambitious climate goals such as achieving net-zero emissions by 2050 the demand for innovative smart lighting solutions is expected to grow exponentially, creating vast opportunities for market players.

Expanding Applications Beyond Traditional Lighting

The expanding scope of smart lighting applications beyond illumination is unlocking new opportunities in the North America market. Modern smart lighting systems are now being integrated with advanced technologies like AI and IoT, enabling functionalities such as environmental monitoring, asset tracking, and health optimization. A report by Accenture shows that businesses leveraging AI-driven IoT solutions could see a 38% increase in operational efficiency by 2030, with smart lighting playing a pivotal role. For instance, AI-powered lighting systems can adapt to user behavior, improving workplace productivity by up to 20, as noted by Harvard Business Review. This diversification of applications positions smart lighting as a versatile tool for addressing diverse consumer and industrial needs, driving further innovation and adoption.

MARKET CHALLENGES

Resistance from Legacy Infrastructure Systems

A critical challenge for the North America smart lighting market is the resistance posed by legacy infrastructure systems, particularly in older buildings and cities. Retrofitting existing structures with smart lighting technology often requires significant modifications, including rewiring and upgrading electrical systems, which can be both costly and time-consuming. The Building Owners and Managers Association (BOMA) reports that nearly 60% of commercial buildings in the U.S. were constructed before 1980, many of which lack the necessary infrastructure to support modern lighting solutions. Furthermore, the American Society of Civil Engineers notes that outdated grid systems in several regions complicate the integration of IoT-enabled devices, limiting scalability. This reliance on aging infrastructure creates a barrier to widespread adoption, especially among property owners unwilling to invest in extensive upgrades. Addressing these structural limitations is essential to overcoming this challenge and ensuring broader market penetration.

Consumer Skepticism Toward Long-Term ROI

Consumer skepticism regarding the long-term return on investment (ROI) of smart lighting systems remains a significant hurdle for market growth in North America. Many potential buyers, particularly in the residential sector, are hesitant to adopt these technologies due to concerns about their upfront costs outweighing the benefits. A study by the National Association of Home Builders reveals that 40% of homeowners perceive smart home upgrades including lighting as unnecessary luxuries rather than essential investments. Apart from these, research indicates that 35% of consumers struggle to fully understand the energy savings or operational advantages offered by smart lighting, leading to hesitation in making purchases. While manufacturers and industry experts emphasize the long-term financial and environmental benefits, the lack of clear, relatable data on ROI makes it difficult to convince skeptical buyers. Bridging this gap in consumer education is crucial to fostering trust and driving higher adoption rates.

REPORT COVERAGE

SEGMENTAL ANALYSIS

By Installation Insights

The new installations emerged as the leading segment in the North America smart lighting market by capturing 65.1% of the total share in 2024. This growth was driven by the surge in new construction projects including smart city developments and modern residential complexes. The U.S. Census Bureau noted that over 1.5 million housing units were newly built during the year, with many featuring smart lighting systems due to their growing popularity. Moreover, government policies promoting energy-efficient technologies encouraged builders to integrate these solutions into new structures. New installations played a critical role in shaping the future of smart infrastructure, offering long-term benefits like reduced energy costs and improved sustainability for both households and businesses.

The retrofit installations segment is projected to grow at the highest pace, with a CAGR of 14.6% expected between 2025 and 2033. This rapid expansion will be fueled by the pressing need to upgrade aging lighting systems in existing buildings. Statistics Canada shows that nearly 60% of commercial structures in North America were built before 1980 is making them ideal candidates for retrofitting. The Environmental Protection Agency emphasizes that replacing traditional lighting with smart systems can cut energy usage by up to 70%, creating significant cost savings. Moreover, government incentives, such as tax breaks for adopting energy-efficient technologies, will further boost adoption rates. As retrofit installations become more affordable and practical, they will play a vital role in modernizing outdated infrastructure while promoting environmental sustainability across the region.

By Offering Insights

In 2024, hardware claimed the top position in the North America smart lighting market by capturing nearly 60.3% of the total market share. This was fueled by the rising adoption of lights and luminaires, which serve as the backbone of smart lighting systems. According to the U.S. Department of Energy, LED-based smart lighting solutions contributed to a 50% reduction in energy usage across homes and businesses. Also, the demand for advanced lighting controls such as motion sensors and dimmers grew significantly due to their ability to optimize energy efficiency and enhance user convenience. Hardware’s critical role lies in providing the essential physical components that enable smart lighting functionality is making it indispensable for both new installations and retrofit projects.

Whereas, the post-installation services segment is predicted to experience the highest growth rate, with a CAGR of 16.1% anticipated from 2025 to 2033. This quick expansion will be caused by the growing complexity of smart lighting systems, which often require ongoing technical assistance and maintenance. The National Institute of Standards and Technology notes that approximately 40% of IoT-enabled devices including smart lighting systems encounter operational challenges within the first year, underscoring the need for reliable support. Homeowners and businesses alike are increasingly seeking these services to ensure optimal performance, resolve connectivity issues, and extend the lifespan of their systems. As smart lighting becomes more integrated into everyday life, post-installation services will play a vital role in ensuring customer satisfaction and fostering long-term adoption.

By Application Insights

The indoor commercial category stood as the most prominent application in the North America smart lighting market by having 35.8% of the total share in 2024. This was influenced by the growing integration of smart lighting systems in offices, retail outlets, and hospitality establishments to lower energy expenses and boost operational efficiency. The U.S. Energy Information Administration reported that commercial buildings account for nearly 20% of the country’s electricity usage, with lighting being a major contributor. By adopting smart lighting solutions, businesses achieved energy savings of up to 60% is making these systems a top priority. The significance of this segment lies in its dual ability to promote sustainability while creating well-lit, productive environments that benefit both employees and customers.

Highways and roadways lighting in the outdoor category is projected to grow at the highest pace, with a CAGR of 18% expected from 2025 to 2033. This surge will be driven by rising investments in smart city initiatives and infrastructure upgrades across North America. According to the Federal Highway Administration, replacing conventional streetlights with smart lighting systems can cut energy consumption by as much as 70%. These systems also improve public safety by incorporating features like motion sensors and real-time monitoring to detect anomalies or emergencies. As urban areas expand and governments emphasize sustainable urban development, smart lighting for highways and roadways will become critical in reducing environmental impact and enhancing traffic flow. This segment’s rapid growth shows its essential role in building smarter, safer, and more eco-friendly cities.

By Technology Insights

In 2024, the wireless category which is dominated by Zigbee technology emerged as the largest segment in the North America smart lighting market by securing 40.7% of the total share. This growth was attributed to Zigbee’s ability to deliver dependable, low-power connectivity while seamlessly integrating with IoT devices, making it a top choice for both residential and commercial applications. The Federal Communications Commission noted that over 60% of IoT-enabled devices in North America utilized wireless protocols like Zigbee due to their adaptability and ease of deployment. Besides these, Zigbee’s mesh networking feature allows multiple devices to interact efficiently, ensuring robust communication across networks. Its widespread use exhibits its critical role in fostering interoperability and advancing the shift toward interconnected smart environments.

BLE (Bluetooth Low Energy) is expected to experience the fastest growth rate within the wireless segment, with a CAGR of 22.4% anticipated from 2025 to 2033. This surge will be fueled by the rising demand for smartphone-controlled smart lighting systems, as BLE enables direct interaction with mobile devices without requiring additional hubs. The Consumer Technology Association reports that over 80% of consumers favor using mobile apps to manage smart home devices are driving the popularity of BLE-based solutions. Moreover, BLE’s energy-efficient design and compatibility with emerging technologies such as voice assistants make it an attractive option for modern lighting systems. As user convenience becomes a priority, BLE’s ability to simplify control and enhance accessibility will propel its adoption.

Country Level Analysis

In 2024, the United States emerged as the largest contributor to the North America smart lighting market by commanding a share of 85%. This was underpinned by its advanced technological infrastructure and widespread integration of IoT-enabled solutions. The Energy Information Administration noted that smart lighting systems helped reduce energy consumption in commercial buildings by up to 15%. Major urban hubs like New York and Los Angeles spearheaded this growth through large-scale smart city initiatives. The nation’s commitment to sustainability, coupled with policies encouraging energy-efficient technologies, solidified its position as the region's most influential player, shaping trends and setting benchmarks for innovation.

Canada is projected to lead the fastest growth trajectory in the North America smart lighting market, with an anticipated CAGR of 18.5% from 2025 to 2033. This surge will be driven by aggressive investments in green technologies and stringent environmental targets aimed at achieving net-zero emissions by 2050. Natural Resources Canada shows that smart lighting systems could lower household energy usage by up to 60%. Government-backed incentives, such as subsidies for energy-efficient upgrades, are expected to accelerate adoption. As cities like Toronto and Vancouver expand their smart infrastructure, Canada’s market will gain significant traction, making it a pivotal hub for innovation and sustainable development in the region.

Top 3 Players in the market

Philips Lighting

Philips Lighting has solidified its reputation as a trailblazer in the North America smart lighting sector, driven by its dedication to innovation and environmental responsibility. The company is celebrated for crafting cutting-edge lighting solutions tailored to both household and professional environments. Its products are engineered to deliver exceptional energy savings while ensuring effortless compatibility with popular smart home platforms such as Amazon Alexa and Google Home. Philips Lighting has also championed the concept of human-centric lighting, which aims to improve overall well-being by replicating the effects of natural sunlight. Through its relentless pursuit of technological advancement, the company has not only set a high bar for competitors but also inspired broader industry progress. Its focus on intuitive designs and sustainable practices has earned it widespread trust among consumers and businesses alike.

Cree

Cree has made a substantial impact on the North America smart lighting landscape by leveraging its expertise in state-of-the-art LED technology and eco-conscious solutions. The company is renowned for its ability to blend superior performance with remarkable energy efficiency, making its offerings suitable for diverse applications, ranging from residential spaces to expansive industrial projects. Cree’s commitment to pushing the boundaries of design and functionality is reflected in its sleek and reliable products that appeal to environmentally aware buyers. By prioritizing practicality without compromising on aesthetics, Cree has successfully broadened the adoption of smart lighting across the region. Its contributions have not only elevated consumer expectations but also redefined standards for quality and innovation in the industry.

Lutron

Lutron has distinguished itself as a prominent force in the North America smart lighting market through its specialization in creating adaptable and user-friendly lighting control systems. The company excels in providing tools that allow individuals to effortlessly manage lighting intensity, automate routines, and synchronize with other smart devices. Lutron’s emphasis on delivering tailored experiences has positioned its products as a top choice for homeowners and businesses seeking convenience and elegance. With its sleek designs and seamless usability, Lutron has become synonymous with sophistication, particularly in the premium segment of the market. By consistently focusing on enhancing user satisfaction and refining product details, Lutron has played a pivotal role in advancing the smart lighting industry, encouraging others to adopt similar customer-focused strategies.

Top strategies used by the key market participants

Fostering Innovation Through Advanced Technologies

A key approach adopted by major players in the North America smart lighting market is the relentless pursuit of innovation through advanced technologies. Companies are dedicated to enhancing their product offerings by incorporating cutting-edge tools such as artificial intelligence, machine learning, and the Internet of Things. This allows them to design lighting systems that are not only smarter but also more intuitive and responsive to user needs. Features like automated adjustments, voice commands, and energy-saving capabilities are being developed to provide a seamless user experience. By staying at the forefront of technological trends, these firms ensure their products stand out in a competitive market while addressing the growing demand for convenience, efficiency, and modernization in lighting solutions.

Building Collaborative Networks for Broader Impact

Another critical strategy involves forming collaborative networks with other industry leaders and stakeholders. By partnering with technology companies, software developers, and even government bodies, these firms aim to expand their reach and enhance their product ecosystems. Such collaborations often focus on integrating smart lighting systems into larger frameworks, such as smart homes or urban infrastructure, to deliver interconnected and comprehensive solutions. These partnerships enable companies to combine expertise, resources, and innovative ideas, accelerating the development of advanced features and applications. This approach not only strengthens their market presence but also ensures their solutions cater to a wide range of customer needs, from individual users to large-scale enterprises.

Championing Eco-Friendly Practices and Solutions

A growing emphasis on sustainability has become a cornerstone strategy for key players in the North America smart lighting market. Companies are increasingly designing products that prioritize energy efficiency and environmental responsibility. By promoting eco-conscious practices, they aim to align their brands with global sustainability goals and appeal to environmentally aware consumers. Their focus is on creating lighting solutions that reduce energy usage and minimize environmental impact, positioning these products as responsible choices for homes and businesses alike. This strategy not only helps build trust and loyalty among customers but also underscores the companies’ commitment to contributing positively to the planet while meeting the demands of a greener future.

KEY MARKET PLAYERS AND COMPETITIVE LANDSCAPE

Companies playing a prominent role in the North America Smart Lighting Market are Cree,Sengled,Eaton,Cisco,Caseta by Lutron,Honeywell,Kichler,Cooper Lighting.

The smart lighting market in North America is highly dynamic, with numerous companies striving to take the lead. Major brands such as Philips Lighting, Cree, and Lutron are at the forefront due to their focus on high-quality products and cutting-edge innovations. These firms emphasize creating energy-efficient systems that are user-friendly and compatible with platforms like Amazon Alexa and Google Home. They also invest heavily in research to introduce advanced features that meet customer needs.

Smaller companies are also making their mark by offering budget-friendly options or targeting niche markets, such as industrial or outdoor lighting. To strengthen their positions, many businesses collaborate with tech companies or acquire smaller innovators to enhance their product portfolios. For instance, partnerships with AI developers have enabled some firms to integrate intelligent capabilities into their lighting solutions.

Competition extends beyond just products to pricing strategies and promotional efforts. Companies often provide discounts, bundle offers, or educational campaigns to attract buyers. They highlight the benefits of smart lighting, such as reduced energy costs and improved home safety. Government initiatives promoting sustainable technologies through incentives and regulations further fuel this competition. This vibrant environment benefits consumers by providing a wide range of options and encouraging continuous innovation. In summary, the North America smart lighting market is evolving rapidly, with companies exploring creative ways to differentiate themselves while making these systems more accessible and practical for everyday use.

RECENT HAPPENINGS IN THE MARKET

In January 2025, Lifx introduced its first smart lamp, the Lifx Luna, at CES 2025. Featuring 26 controllable color zones and Matter over Wi-Fi compatibility, the Luna aims to enhance smart home integration and will be available exclusively through The Home Depot starting March 2025.

In January 2025, Aqara unveiled three new touchscreen controllers—the Panel Hub S1 Plus, Touchscreen Dial V1, and Touchscreen Switch S100—at CES 2025 in Las Vegas. These products are designed to replace traditional switches, offering users advanced control over smart lighting and other home automation systems.

In January 2025, Philips Hue announced the upcoming launch of its AI-powered lighting assistant. This new feature will enable users to create and customize lighting scenes based on mood, occasion, or personal style, enhancing the personalization of smart lighting experiences.

In February 2025, the U.S. Department of Energy delayed the implementation of new energy efficiency test procedures for general service lamps. Originally set for January 7, 2025, the new enforcement date of March 21, 2025, provides stakeholders additional time to adjust to updated regulatory standards.

In January 2025, states including California, Colorado, Hawaii, Oregon, Rhode Island, and Minnesota enacted fluorescent lighting bans due to environmental and health concerns. This regulatory shift is expected to accelerate the transition to mercury-free, energy-efficient LED lighting solutions.

MARKET SEGMENTATION

This research report on the North America Smart Lighting Market has been segmented and sub-segmented into the following categories.

By Installation

• New Installations
• Retrofit Installations

By Offering

• Hardware
  • Lights and Luminaries
  • Lighting Controls
• Software
  • Services
  • Pre Installation Service
  • Post Installation Service

By Application

• Indoor
  • Commercial
  • Industrial
  • Residential
  • Others

• Outdoor
  • Highways Roadways Lighting
  • Architectural Lighting
  • Lighting for Public Spaces

By Technology

• Wired
  • DALI
  • Power Over Ethernet
  • Power line Communications
  • Wired Hybrid Protocols
• Wireless
  • Zigbee
  • Wi Fi
  • BLE
  • EnOcean
  • 6LoWPAN
  • Wireless Hybrid Products

By Country

• The U.S.
• Canada
• Rest of North America.