Explain how the rise of digital platforms and data analytics has altered the market environment for traditional manufacturing firms in India. Identify at least two strategic responses these firms can adopt to remain competitive.
Answer
Digital platforms and data analytics increase competition and customer expectations; firms should adopt online sales channels and use data analytics for demand forecasting.
Step-by-step solution
- Define digital platforms as online marketplaces and data analytics as using data for insights.
- Explain that these reduce entry barriers, intensify competition, and shift consumer expectations to online, data‑driven interactions.
- Strategic response 1: establish direct online sales channels to reach customers.
- Strategic response 2: employ data analytics for demand forecasting and supply‑chain optimisation.
- Conclude that integrating digital tools is essential for competitiveness.
Common mistake: Assuming digital platforms only affect marketing, not operations
Concept tested: Digital impact on market environment
Published · How this solution was prepared and checked
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