Back to the Future: Retro Products and LEDs Light the Way for Christmas Decoration Demand

Back to the Future: Retro Products and LEDs Light the Way for Christmas Decoration Demand

US demand for Christmas lighting sets is forecast to total $515 million 2021. Anticipated contraction in Christmas tree purchases in unit terms will weigh on demand for associated lights. Faster declines will be prevented by sanguine economic conditions, such as continued growth in disposable personal income levels and home purchases.

LED Takeover

Over much of the decade to 2016, demand for Christmas lights grew in a slow but stable fashion as consumers became more interested in decorating for the holidays and needed occasional replacements. However, the pace of demand growth sped up in the latter part of the decade as consumers abandoned their older incandescent lights in favor of LEDs, as the latter feature longer lifespans.

Households with children are an essential market for LEDs. Such households tend to invest in more elaborate displays, and LEDs allow them to incorporate special features in these displays such as color changes and flashing patterns, often synced to music or other sounds. LEDs are more energy efficient and safer than traditional incandescent lights, because they produce relatively less heat.

Over the forecast period, many consumers are expected to be drawn to LEDs as replacements for incandescent lights, as LEDs have become less expensive since their introduction. Despite LEDs’ advantages, incandescent Christmas lights are still widely used and purchased.

Traditional Lights Also a Mainstay

Although many consumers are drawn to the newest technologies, such as smart lights, some are also fascinated by traditional items. Millennials are a key market for Christmas lights, as many of them are first-time buyers of decorations when starting a household or having a baby. This group tends to appreciate tradition. For instance, millennials are more likely to prefer standalone holiday light strings to pre-lit Christmas trees. Additionally, they are slightly more likely to own traditional white holiday lights compared to the general population. Certain retro items such as bubble lights and metal Christmas trees appeal to both younger and older people who are nostalgic for the past.

Want to Learn More?

For in-depth analysis of Christmas lighting trends, see Christmas Lighting Sets: United States, a report published by the Freedonia Focus Reports division of The Freedonia Group.

The report contains historical data and analysis of Christmas lighting sets demand in value terms from 2006-2016 with projections to 2021. Demand is segmented by product type as follows:

  • miniature lights
  • other holiday light strands, such as those featuring plastic lamp covers.

While you’re there, you can check out other reports covering consumer home goods, such as Christmas Trees: United States, Household Furniture: United States and Tableware & Kitchenware: United States.

About the Author

Cara Brosius is a Research Analyst with Freedonia Focus Reports. She holds a degree in economics, and her experience as an analyst covers multiple industries.