In December last year, Dabur India, maker of Real Active fruit drinks, introduced a mixed fruit-flavoured variant of its flagship health supplement brand Chyawanprash as it wanted to target a wider audience, especially kids. The company also launched fruit -based fizzy drinks ? Burst Fizzy ? in January this year as it wanted to enter a new category ? carbonated drink with fruit juice to compete with colas in India.

Hindustan Unilever or HUL, India’s largest consumer goods company, launched Lifebuoy Clini-Care 10, claiming it offers 10 times better germ protection compared to others. In March, Tata Chemicals created a buzz around its traditional brand Tata Salt by introducing Tata Salt Flavortiz in three flavours, aiming to capture new consumers.

In a bid to launch differentiated products that can stand out from the clutter, or make inroads into markets so far unexplored, consumer goods firms are betting on product innovation, fuelled by higher spends in research and development or R&D efforts. Dabur, for one, is stepping up investments in its R&D projects by 50% in 2012-13, its chief executive Sunil Duggal said.

?Today, Indian consumers are flooded with numerous choices and options,? says an analyst with a domestic brokerage firm. ?Clutter breaking innovation is not optional anymore. It?s a survival necessity for brands in a market that has at least a dozen competing brands vying for the same consumer mind space.?

Companies in the R1,45,000-crore Indian FMCG sector launched over 5,000 brands in the last two years, analysts said. Brand launches in categories such as foods, personal care and home care are growing at 40% annually in the last three years, point out industry analysts.

Dabur India, the fourth largest FMCG company in India, which went for a revamp last year has now consolidated its entire FMCG business under its consumer care division. ?Before Dabur restructured its operations, the company?s focus on its FMCG business was slightly blurred. Following its revamp, the company is scaling up its operations with new launches and initiatives,? said an industry analyst with a domestic broker in Mumbai.

?Today, consumers have many options,? says Duggal. ?We are increasing our R&D spend as we want to drive our innovation to a much higher level than last year.? The company, which spent R36.8 crore on R&D last year, will spend around R55 crore now. Duggal says new launches like Burrst Fizz and variants of its skin care band Dabur Uveda have gained ?both market share and the consumer mind space within months of hitting the shelves?.

Dabur India has its R&D centre at Sahibabad near its corporate office in New Delhi.

Godrej Consumer Products, which sells Cinthol soap and Renew hair colour, is also hiking its R&D spend ?considerably? in 2012. ?We are considerably increasing our spend on R&D activities in 2012,? says Adi Godrej, chairman of the Godrej Group, without revealing how much the spending would be.

?The return on investment in our R&D efforts has been good. We are putting a lot of emphasis on innovations to fuel growth this year.?

In 2011, GCPL launched a slew of new variants in its flagship soap and hair colour brands Godrej No 1 and Godrej Expert. ?The variants of Godrej Expert, Renew Hair colour?s ten new shades are doing well in the market place. It?s too early to comment on numbers,? says a company spokesperson.

Meanwhile, the world’s second largest consumer goods company Unilever, which spent 1 billion euros in R&D in FY 2011, is driving some of its recent India innovations from its R&D centre in Bengaluru. ?The Unilever R&D Centre in Bengaluru is one of the six major strategic labs for Unilever and was at the heart of Unilever?s latest technological breakthrough ? Lifebuoy Clini-care10 ? which has just been launched in India,? a Unilever spokesperson said. Currently, HUL leads the pack in the branded toilet soaps markets in India, followed by Godrej and Wipro.

Vineet Agarwal, president of Wipro Consumer Care, part of the Asim Premji led Wipro Group, says the company is planning to increase its spend on R&D projects in 2012 as compared to 2011. ?Innovation plays a big role in expanding consumer franchise in any markets,? he adds. Wipro Consumer Care has launched four variants of its flagship soap brand Santoor with aggressive ad campaigns three months ago.

Meanwhile Parle Agro, makers of Frooti fruit dink, is sharpening its focus on innovations to expand its consumer franchise in domestic markets. ?The marketing landscape is very different from what it was a decade ago,? says Nadia Chauhan Kurup, joint managing director of Parle Agro. ?Innovation has become the key to staying ahead in today?s changing world as there is a plethora of choices available to the consumers. Research & development has always been a major focus area for Parle Agro,? she adds. In 2011, Parle Agro introduced ?Love Litchi?, a natural litchi drink in the North Eastern market of India. ?The product was launched based on the skill and expertise of our R&D team coupled with our understanding of the market and ability to rightly predict consumer trends,? explains Chauhan.

Recently, the company o introduced Joystix Kaju, a stick shaped confectionery priced at R2.

The Tata Group, that boasts of innovations like the world?s cheapest car and water purifier, has improved its market share in consumer products like salt through constant innovation. Group company Tata Chemicals launched its Tata Salt Flavoritz across major cities in India. ?The idea is to give consumers ?never-tasted-before? blends of flavors that give a new dimension to their daily food,? says Ashvini Hiran, chief operating officer, consumer products division, Tata Chemicals.

As part of its innovation strategy, Tata Chemicals is planning to introduce a slew of new products in the next few months. Driving these innovations are its innovation centre at Pune.