Indoor Smart Lighting Market – Global Industry Size, Share, Trends, Opportunity, and Forecast Segmented by Offering (Hardware, Software, Services), By Communication Technology (Wired, Wireless), By Installation Type (New Installations, Retrofit Installations), By Region, Competition 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 17.92 Billion
CAGR (2026-2031)	6.79%
Fastest Growing Segment	New Installations
Largest Market	Asia Pacific
Market Size (2031)	USD 26.58 Billion

Market Overview

The Global Indoor Smart Lighting Market will grow from USD 17.92 Billion in 2025 to USD 26.58 Billion by 2031 at a 6.79% CAGR. Global indoor smart lighting consists of intelligent illumination fixtures integrated with sensors, wireless connectivity, and automated control systems that regulate light intensity and color temperature within enclosed environments. The market is primarily driven by stringent government regulations mandating energy efficiency and the growing commercial demand for systems that reduce operational expenditures through automated management. According to LightingEurope, in 2024, smart lighting technologies were estimated to provide the potential for more than 40 percent additional energy savings compared to conventional setups. This significant efficiency gain serves as a primary catalyst for adoption across residential and commercial sectors.

However, the market faces a substantial challenge in the form of high initial implementation costs and complex interoperability requirements. The expense of retrofitting legacy infrastructure with compatible smart devices can deter price-sensitive consumers and small enterprises from upgrading their existing systems. Furthermore, the difficulty of ensuring seamless communication between products from different manufacturers often complicates installation and maintenance, potentially impeding the rate of widespread market expansion.

Key Market Drivers

The implementation of stringent energy-efficiency regulations and sustainability mandates acts as a fundamental engine for growth in the Global Indoor Smart Lighting Market. Governments worldwide are aggressively phasing out inefficient illumination technologies, compelling commercial and industrial facilities to adopt intelligent LED systems that minimize carbon footprints and operational costs. This regulatory pressure drives the development of fixtures capable of granular control, daylight harvesting, and occupancy sensing to meet net-zero targets. According to Acuity Brands, December 2025, in the '2025 Annual Report', the company reported enabling an estimated 46 million metric tons of greenhouse gas avoidance from fiscal 2020 through fiscal 2025 by deploying their energy-efficient products and services.

Seamless integration with Internet of Things (IoT) and smart home ecosystems serves as the second major force accelerating market expansion. As residential and commercial environments become increasingly digitized, users demand lighting solutions that interoperate effortlessly with voice assistants, security systems, and climate controls through unified protocols like Matter. This connectivity transforms simple bulbs into intelligent nodes that enhance user experience and building management. According to Signify, October 2025, in the 'Third Quarter Results 2025', the company's installed base of connected light points expanded to 160 million, underscoring the rapid scaling of network-integrated illumination. Furthermore, the emphasis on high-quality, controllable light is reshaping design priorities; according to Lutron Electronics, in December 2025, 94 percent of designers and architects surveyed in the 'Luxury Residential 2026 Trend Report' indicated that clients now consider lighting design a highly important element of their living environments.

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Key Market Challenges

The high initial implementation costs and complex interoperability requirements act as a significant brake on the expansion of the Global Indoor Smart Lighting Market. Price-sensitive consumers and small enterprises often delay purchasing decisions because the financial outlay required to retrofit legacy infrastructure with intelligent fixtures is substantial. This economic barrier is clearly quantified by recent industry data; according to the Association for Smarter Homes & Buildings (ASHB), in 2024, the high cost of purchase and implementation was identified as the top barrier to adoption, cited by 36 percent of current users and 34 percent of non-users in their technology trends survey. Such financial constraints directly limit the addressable market size by effectively excluding budget-constrained buyers who cannot justify the upfront premium.

Furthermore, the lack of seamless communication between products from different manufacturers creates a fragmented ecosystem that frustrates end-users. When devices fail to interact reliably, installation becomes intricate and maintenance costs rise, effectively negating the promised operational efficiency. This technical complexity erodes consumer confidence, causing potential adopters to hesitate rather than risk investing in a disjointed system that may require frequent, expensive troubleshooting. Consequently, these dual challenges of cost and compatibility stall widespread market penetration.

Key Market Trends

The Adoption of Human-Centric Lighting (HCL) for Circadian Rhythm Support is fundamentally altering market dynamics by placing biological health at the center of illumination design. Rather than focusing solely on visual acuity, manufacturers are developing tunable systems that mimic natural daylight patterns to regulate occupant sleep-wake cycles and enhance productivity. This shift is particularly evident in the luxury residential sector, where user demand for wellness-oriented technology is intensifying. According to Lutron Electronics, December 2025, in the 'Luxury Residential 2026 Trend Report', 44 percent of affluent homeowners recognize that effective lighting has wellness benefits, validating the transition from static fixtures to dynamic, health-supportive environments.

Simultaneously, the Convergence of Lighting with Integrated Building Management Systems represents a critical evolution in commercial infrastructure. Modern lighting grids are being repurposed as the digital backbone of smart buildings, collecting occupancy and environmental data that informs broader facility operations such as heating and cooling. This systemic integration is driven by the need to unlock deep efficiency gains that standalone LED retrofits cannot achieve. According to LightingEurope, February 2025, in the 'Annual Report 2024', lighting accounts for around 20 percent of the total cost-effective electrical energy savings potential in non-residential buildings, incentivizing property managers to deploy unified platforms that maximize these operational reductions.

Segmental Insights

The New Installations segment represents the fastest-growing category within the Global Indoor Smart Lighting Market. This expansion is primarily driven by the increasing development of smart commercial and residential infrastructure globally. Regulatory frameworks, such as the energy conservation codes established by the International Code Council, compel developers to adopt efficient technologies in new projects. Consequently, builders prioritize the integration of connected lighting systems during the initial construction phase to ensure compliance and immediate operational efficiency. This proactive approach avoids the technical compatibility limitations often encountered with retrofitting, thereby fueling the rapid adoption of new lighting installations.

Regional Insights

Asia Pacific commands the leading position in the Global Indoor Smart Lighting Market, primarily driven by rapid urbanization and government mandates favoring energy conservation. Countries such as China and India contribute significantly through large-scale smart city initiatives that integrate intelligent automation to optimize power usage in commercial and residential buildings. The region also benefits from a concentrated manufacturing ecosystem, which ensures the cost-effective production and consistent availability of lighting components. Furthermore, rising disposable incomes are accelerating the adoption of connected home systems, collectively sustaining Asia Pacific as the dominant market region.

Recent Developments

• In September 2025, Signify launched a comprehensive range of new products for its Philips Hue brand during an event in Berlin, marking one of its largest hardware releases to date. The announcement included the Philips Hue Bridge Pro, a new hub designed to support a greater number of devices and enhanced connectivity features. The company also introduced the Philips Hue Flux indoor light strips, which utilize high-density LEDs for seamless illumination. Furthermore, Signify revealed a new strategic partnership with Sonos, enabling users to synchronize their smart lighting directly with Sonos sound systems for an immersive audio-visual environment in the home.
• In September 2024, Govee unveiled its latest advancements in smart lighting technology at the IFA consumer electronics trade show in Berlin. The company launched the Govee Strip Light 2 Pro and the Govee COB Strip Light Pro, both featuring the new LuminBlend Color Control System to deliver enhanced color accuracy and smoother gradients. These new indoor lighting solutions were designed with Matter compatibility, facilitating easier integration with existing smart home networks. The flagship strip lights introduced advanced RGBWW capabilities and customizable segmentation, allowing users to create intricate lighting effects for gaming setups and living spaces, further solidifying Govee’s position in the market.
• In March 2024, Samsung SmartThings and Signify expanded their strategic partnership to deepen the integration between the Philips Hue lighting ecosystem and the SmartThings platform. This collaboration enabled users to control the Philips Hue Sync TV App directly through the SmartThings mobile application on Galaxy devices. The integration allowed for the adjustment of light sync settings, brightness levels, and operating modes—such as Video, Game, and Music—without interrupting content playback on the TV. By streamlining the interaction between smart lighting and home entertainment systems, the companies aimed to provide a more cohesive and convenient automation experience for consumers globally.
• In January 2024, Nanoleaf announced a significant expansion of its smart lighting portfolio at the Consumer Electronics Show, introducing three new Matter-compatible products designed to enhance indoor and outdoor residential spaces. The company revealed the Smart Multicolor Lightstrip for indoor use, alongside its first exterior offerings, the Smart Multicolor Outdoor String Lights and Permanent Outdoor Lights. These devices were engineered to integrate seamlessly with the Matter ecosystem, ensuring broad compatibility with major smart home platforms. Additionally, Nanoleaf unveiled "Orchestrator," a new software feature that analyzes music in real-time to generate synchronized, dynamic light shows, offering users a more immersive entertainment experience.

Key Market Players

• Control4 Corp.
• Crestron Electronics Inc.
• Hubbell Incorporated
• Lutron Electronics Co. Inc.
• Inter IKEA Holding BV
• Signify Holding
• Wyze Labs Inc.
• EGLO Leuchten GmbH
• GE Lighting
• Acuity Brands Inc.

By Communication Technology	By Installation Type	By Region
Wired Wireless	New Installations Retrofit Installations	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Indoor Smart Lighting Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Indoor Smart Lighting Market, By Communication Technology:

• Wired
• Wireless

• Indoor Smart Lighting Market, By Installation Type:

• New Installations
• Retrofit Installations

• Indoor Smart Lighting Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE