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For the last few years, the D2C story in India framed a fight between startups and large consumer companies.

The startups moved faster, understood customers better, and built brands online. The large companies had distribution, capital, supply chains, and decades of brand strength.

This framing now looks dated.

When david and goliath met for ☕️

Voltas and Atomberg Innovation announced a 50:50 joint venture to make AC compressors in India. The planned Chennai unit will have an initial capacity of about 2.8 million compressors a year. Voltas will be the main customer, but the venture can also sell to other AC makers.

Atomberg is best known as a consumer appliance startup focused on fans. The Voltas deal has little to do with D2C sales. It centers on engineering and manufacturing.

Atomberg co-founder Manoj Meena described the compressor as the “heart of an air conditioner” and noted that India still imports a large share of this part. The interesting aspect is that a Tata group company is setting up an equal joint venture with a company that was recently viewed mainly as a new-age fan brand.

The palmolive deal is different.

Colgate-Palmolive India brought in Bombay Shaving Company to handle the consumer-facing online business for Palmolive. Colgate will continue to own the brand and manage the products, quality, supply chain, and offline sales. Bombay Shaving Company will manage much of the online advertising and customer relationships.

Colgate-Palmolive India MD and CEO Prabha Narasimhan described the arrangement: “End-to-end is really all the consumer-facing advertising and the customer relationships on Palmolive are being handled by Bombay Shaving Company.”

She was clear about the reason. Speaking about Palmolive, she said,

“We’ve not done a great job with Palmolive.”

This makes the deal worth attention.

Colgate is not buying Bombay Shaving Company or a brand from it. It is using a D2C company for a part of the business that large consumer companies usually keep close to themselves.

These two deals differ, but they point to the same change.

D2C companies are no longer just small brands trying to take share from large companies. Some have built skills that larger companies now want to use.

This has been building for a while.

• HUL agreed in 2025 to buy 90.5% of Minimalist. At that point, Minimalist had crossed an annual sales run rate of ₹500 crore, only a few years after launch. HUL wanted a stronger position in premium beauty and skin care. Minimalist gained access to HUL’s large offline network.

• Marico has taken a similar route with brands like Beardo, Plix, True Elements, Just Herbs, Cosmix, and 4700BC. These brands are no longer tiny side bets for the company. Beardo, Plix, True Elements, Cosmix, and 4700BC together reported sales of ₹1,552 crore in FY26.

Marico CEO Saugata Gupta explained the company’s need for these businesses. “The core can only grow by mid or low single digits,” he said regarding the role of newer digital businesses.

• ITC has done the same with Yoga Bar and other newer brands. Wipro Consumer Care has also moved into digital-first skin care through its investment in Dermatouch.

Large consumer companies buying D2C brands is no longer new. What seems newer is the type of relationship we are seeing.

Voltas is working with Atomberg at the product and manufacturing level. Colgate is working with Bombay Shaving Company at the online sales and customer level. In both cases, the D2C company brings more than a brand name.

The numbers show why this is happening.

• Bain and DSG Consumer Partners estimate that newer consumer brands in India reached about $7.5 billion in sales in FY25, around 3.75 times their FY20 size. Many of these brands are growing faster than the larger product groups they compete in.

• Online retail has grown large enough that consumer companies cannot treat it as a side channel. Bain estimates that Indian e-retail sales reached about $65 billion to $66 billion in 2025, with close to 300 million online shoppers.

• Quick commerce has strengthened this shift. By 2024, it accounted for more than two-thirds of India’s online grocery orders and had become a $6 billion to $7 billion market.

This does not mean offline retail is becoming less important.

Others estimates that even by 2030, about 90% of India’s retail market will still be offline. This explains why many D2C brands that started online are now trying to enter more stores, work with distributors, and build offline sales.

This also explains why the old D2C model has changed.

A brand can start online, find its first customers through Instagram or Amazon, grow through quick commerce, and then move into stores. It does not have to choose between online and offline from day one.

Large consumer companies are becoming more willing to work with smaller brands, buy them, invest in them, or let them run parts of the business.

The Palmolive deal is a good example because Colgate already owns the brand. It seems to want from Bombay Shaving Company the way it operates online, how it sells, tests ads, reads customer response, and manages online channels.

This may be more important than another acquisition.

It suggests that some D2C companies are starting to become operating partners for larger firms, not just brands waiting to be bought.

The Atomberg deal shows another version of the same idea. Atomberg is not used for marketing. It is used for product and engineering skills in a part of the AC business unrelated to its original D2C identity.

This makes the term D2C less useful than it was a few years ago.

Many of these companies are becoming normal consumer companies. They sell online and offline. They build products, run factories, work with distributors, partner with large firms, and sometimes become part of larger groups.

At the same time, older consumer companies are learning from these startups.

The story is no longer about D2C companies replacing FMCG companies. It is about the two starting to look more alike.

HUL buying Minimalist was one sign. Marico is building a large part of its new growth through digital-first brands. Voltas is setting up an equal joint venture with Atomberg, and Colgate is giving Bombay Shaving Company control of Palmolive’s online customer-facing business, taking that one step further.

Tl;dr: India’s D2C companies are not outside the consumer market anymore. They are becoming part of how the market works.