Quick commerce platforms are leveraging their market position to demand increased margins and marketing funds from consumer goods companies, leading to auction-style bidding for product visibility.
New Delhi, India Jul 21, 2026 ALN: Kolkata: Quick commerce platforms are taking advantage of their growing clout in the retail network to demand higher margins, bigger marketing spends, and even auction-style bidding for better product listings and keyword searches as they scale up, said chief executives at leading consumer goods companies. This evolution in the business model of quick commerce platforms reflects a significant shift in the dynamics of the retail landscape, particularly in the context of the rapid digital transformation that has reshaped consumer behavior and shopping habits.
The segment has become the fastest-growing sales channel for groceries, daily essentials, and fast-moving consumer goods (FMCG) products, accounting for up to 75% of online sales at several leading manufacturers. The rise of quick commerce can be attributed to various factors, including increased smartphone penetration, improved internet connectivity, and changing consumer preferences that favor convenience and speed. As consumers increasingly seek immediate access to products, quick commerce platforms have positioned themselves as essential players in fulfilling these demands.
Companies reported that spending on the channel has increased by about 20% year-on-year and surges by as much as 40% during peak demand periods, including weekends and festivals. This trend underscores the importance of strategic marketing and promotional efforts in capitalizing on high-traffic periods, which are crucial for driving sales and enhancing brand visibility. The channel has been more profitable for consumer goods companies as it drives a higher mix of premium products, suggesting that consumers are willing to pay more for the convenience of quick delivery.
Industry executives noted that brands now pay platforms not only for premium placement in category listings and search results but also for ‘surrogate’ searches. Surrogate searches occur when a consumer searches for one brand, and rival products are displayed alongside it. This practice, which previously operated on fixed rates, is now increasingly shifting towards informal auction-style bidding. This change indicates a more competitive and dynamic environment where brands must continuously evaluate their marketing strategies and budgets to maintain visibility and accessibility.
AWL Agri Business, India’s largest packaged edible oil company, has observed that quick commerce platforms, which were once focused on burning cash to gain market share, are now under pressure to improve profitability. This shift reflects a broader trend in the industry where companies that initially prioritized growth are now compelled to focus on sustainable financial practices. “They ask how much we are willing to invest, and the ask has gone up with almost open bidding for several marketing activities,” said executive deputy chairman Angshu Mallick. The rise in costs during high-consumption periods, such as Holi, Navratri, Eid, and weekends, as well as for seasonal categories like besan during Janmashtami, highlights the need for brands to be agile and responsive in their marketing approaches.
For many companies, quick commerce is now almost as large as modern trade and is a preferred channel to push premium products and new launches. This trend has prompted companies to develop quick commerce-specific products and packaging that cater to the unique demands of this sales channel. As the quick commerce sector continues to grow, brands are increasingly recognizing the need to innovate and differentiate their offerings to capture consumer interest and drive sales.
Historically, only large modern retail chains such as D’Mart, Reliance Retail, and the erstwhile Future Group had sufficient scale to negotiate higher margins and tougher trade terms. E-commerce, in contrast, did not achieve a comparable scale until recently, and as a result, it struggled to command similar terms. The emergence of quick commerce has changed this landscape, as platforms are now leveraging their growing influence to negotiate better financial terms with brands.
As platforms scale up, they are seeking better financials, said Tarun Arora, chief executive of Zydus Wellness, which sells Complan and Glucon-D. “Discussions on margins and other partnership opportunities with brands are common, just as in organized retail,” he said. “True partnerships happen when both sides create a win-win situation.” This sentiment reflects the evolving nature of partnerships in the retail sector, where collaboration and mutual benefit are becoming increasingly important for success.
Reliance Retail is among the chains renegotiating margins and trade terms by pitching its grocery stores as well as its quick commerce platform JioMart as a combined offering to brands. This strategy highlights the importance of leveraging multiple sales channels to create a comprehensive value proposition for brands. The company did not respond to queries, but its chief financial officer Dinesh Taluja indicated in a recent analyst call that Reliance Retail is leveraging supplier relationships and scale to improve margins in quick commerce. “Our terms of trade are significantly better than those of peers,” he had said. “That gives us a competitive advantage to offer attractive prices to customers while still maintaining our margins.” This competitive edge allows Reliance Retail to position itself favorably in the market, potentially attracting more brands to partner with them.
However, executives noted that the future of auction-style keyword bidding could depend on the outcome of the Google-Hindware case. The Delhi High Court ruled that Google cannot use a brand’s trademark in keyword advertising, thus preventing rival products from appearing in search results related to specific brands. This ruling could have significant implications for the quick commerce sector, as it may alter the dynamics of how brands compete for visibility online. Google has appealed the decision, and the outcome of this case could reshape the landscape of digital advertising and its impact on e-commerce and quick commerce platforms.
The implications of these developments are profound, as they signify a shift towards a more competitive and structured environment in quick commerce. Brands will need to adapt to the evolving landscape by reassessing their marketing strategies, investing in innovative product offerings, and navigating the complexities of new bidding models. As quick commerce continues to grow, its influence on the broader retail ecosystem will likely expand, prompting further changes in consumer behavior, brand strategies, and the operational frameworks of retail platforms.
In conclusion, the demand for higher margins and innovative marketing strategies in the quick commerce sector reflects a broader trend of increasing competition and evolving consumer expectations. As brands and platforms navigate these changes, the ability to forge effective partnerships and adapt to new market realities will be crucial for success in this rapidly changing landscape.
To learn more about the latest developments in Retail & Consumer, stay updated with our exclusive reports and analyses on AiLensNews.
