Ecommerce: The new R&D lab for India's consumer companies

Quick commerce players are offering a fast, low-risk sandbox for brands to test new concepts

By Chirag Shah

Published: Aug 20, 2025 12:31:03 PM IST

Updated: Aug 20, 2025 01:14:28 PM IST

Ecommerce, once viewed primarily as a distribution channel, is now quietly becoming a strategic engine for innovation. Image: Shutterstock

India’s consumer landscape is undergoing a structural transformation—not just in what consumers buy, but in how new products are conceived, tested, and scaled. Ecommerce, once viewed primarily as a distribution channel, is now quietly becoming a strategic engine for innovation. Increasingly, traditional FMCG giants are leveraging digital platforms to de-risk product launches, accelerate feedback loops, and refine offerings before committing to scale.

Historically, new product development in large consumer companies followed a slow, capital-intensive path. A typical launch might involve 12–24 months of R&D, packaging design, market research, internal approvals, and nationwide distribution through trade networks. The process was optimised for efficiency and reach—but not for speed or iteration. In a market where consumer preferences are shifting rapidly, this model is losing relevance.

Ecommerce has changed that. Platforms like Amazon, Flipkart, Nykaa, and newer quick commerce players such as Blinkit and Instamart offer a fast, low-risk sandbox for testing new concepts. Brands can experiment with flavours, pack sizes, price points, and positioning—all while gathering real-time data on adoption, feedback, and repurchase behavior.

Several large incumbents have adopted this playbook. Marico has used ecommerce to launch and refine Saffola Fittify and Coco Soul, targeting health-conscious consumers in metro India. These products were tested online first, where performance marketing and consumer reviews provided rapid insights on product-market fit. Only after validation did the company expand distribution into general and modern trade.

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ITC has similarly introduced niche offerings like Nimwash (fruit and vegetable wash) and Sunbean Coffee through digital platforms. By doing so, it gained early readouts on demand without disrupting existing supply chains or trade relationships.

Most notably, Tata Consumer Products, in its FY25 annual report, explicitly recognised the strategic value of ecommerce beyond just sales. The company noted: “Ecommerce, especially quick commerce, has emerged as a pivotal growth channel, enabling us to extend our market leadership while accelerating innovation. Ecommerce has become a key launchpad for new products—contributing 15 percent of innovation-to-sales (i2S) in ecommerce—allowing faster concept validation and refinement.”

This is not just a change in channel—it reflects a paradigm shift in the consumer product innovation cycle. Traditional and new-age brands now follow very different playbooks:

Aspect	Traditional Model	Digital-First Model
Product Development	Centralised, R&D-led	Agile, consumer-driven
Validation	Post-launch sales data	Pre-scale, real-time feedback
Launch Strategy	National rollout via retail	Targeted ecommerce-first launches
Iteration	Low flexibility post-launch	Continuous refinement
Hero SKU Identification	12–18 months	4–6 weeks via D2C analytics

Companies like Hindustan Unilever and Nestlé India are evolving in response. HUL launched Love Beauty & Planet and Simple via ecommerce to test resonance among urban consumers. Nestlé piloted Maggi Fusian and new dairy products online before allocating significant offline resources.

This hybrid approach is also influencing M&A activity. Traditional companies are acquiring D2C-first brands not only for growth but for their digital-native innovation capability. Emami’s investment in The Man Company and Marico’s acquisition of Just Herbs reflect this strategic intent.

In today’s consumer economy, consumer intimacy precedes scale. Brands that listen early, iterate fast, and expand intelligently will win.

As India’s consumption story deepens, ecommerce is set to play a foundational role—not just in distribution, but in innovation itself. For companies willing to treat it as a live test market rather than a passive channel, the rewards will go well beyond sales—they will build the future of brand-building itself.