How did Tata Consumer Products use R&D to expand its offerings

Tata Consumer Products has leveraged R&D as a core driver of its portfolio expansion and innovation strategy, especially since 2020. The company’s R&D efforts have directly supported the creation of new products, entry into health and wellness segments, premiumization, and regional as well as international diversification.

Key ways Tata Consumer Products used R&D to expand its offerings:

• Innovation-Led Product Launches:

  • The company established dedicated R&D centers in Bengaluru, Mumbai, Sri City, and London, fostering both local and global innovation.

  • Since 2020, Tata Consumer Products has launched about 70 new products, of which roughly 24% focused on health and wellness, responding to consumer trends and market “white spaces”.

  • R&D has contributed to launching innovations like value-added salts (e.g., Tata Salt Iron Health), functional beverages (Gluco+ with electrolytes and iron), protein supplements (Tata GoFit), and plant-based foods (Simply Better).

• Technology & Patent Development:

  • The company developed patented technologies, such as a granulation process for double fortified salt to improve iron stability, directly addressing nutritional deficiencies in India.

  • Introduction of Microwave Assisted Thermal Sterilization (MATS) technology, which enables ambient shelf stable ready-to-eat and ready-to-cook meals with better texture, revolutionizing food processing for its new categories.

• Consumer-Centric and Data-Driven R&D:

  • R&D used AI and digital tools for consumer insights, enabled mapping of trends (such as millets for health foods), and accelerated speed to market for targeted launches like Tata Soulfull’s millet-based snacks and cereals.

  • Tata collaborates with research institutions like the Indian Institute of Millets Research, Central Salt & Marine Chemicals Research Institute, and others for category-specific advancements.

• Premiumization and Packaging Innovation:

  • R&D also focuses on making products and packaging more premium and tailored, such as for cold-pressed oils, freeze-dried coffees, designer teas, and advanced packaging formats supporting new products1.

  • These innovations extend to international markets (e.g., Tata Raasa, Joyfull), adapting offerings to fit local preferences and regulations.

• Hyperlocal and Regional Customization:

  • R&D enabled the swift development of regionally tailored products, such as South Indian spice blends, hyperlocal tea and snack flavors, and products that cater to local consumption occasions.

• Organizational Adaptation:

  • Tata Consumer’s R&D organization adopted a “fit for future” model, investing ~₹36.35 crore in FY23 and building a robust, cross-functional innovation pipeline with input from both in-house experts and academic/industrial partners.

  • They created frameworks to digitize and accelerate product development and feedback, rapidly bringing new products to market and pivoting based on consumer response.

Impact:

• The contribution of innovations to overall sales has increased, with a fivefold growth in the innovation-to-sales ratio over four years, and targets to reach 5%—considered best-in-class in FMCG.

• Tata Consumer Products has moved from a traditional beverage focus to become a multi-category FMCG leader, with R&D at the heart of its transition, especially in new health, convenience, and premium segments.

These R&D-driven initiatives have enabled Tata Consumer Products to address gaps in the market, offer differentiated value to consumers, and achieve rapid, sustainable expansion across multiple FMCG categories Source:TheEconomicTimes