This Lord is Very Scientific-Chapter 740 - 672

(Anti-theft statement, will be published later.) Summary: With technological advancements and the coverage model of smart networks, the rise of the game industry in recent years has been evident to the general populace. The methods of game distribution have broken away from rigid promotional modes, and the influence of games has gradually expanded into all aspects of life. Correspondingly, game companies need to constantly integrate resources, innovate, and iterate, and improve performance to keep pace with the rapid development of the times. A diversification strategy perfectly meets the planning needs and development goals within the game industry. Against the backdrop of economic globalization, diversification strategy, as the preferred mode of enterprise development, is equally applicable to game companies. This article uses Sanqi Mutual Entertainment Company as an example to explain the impact of diversification strategy on the performance of game companies.

Keywords: Diversification strategy; Game company; Performance; Impact; Sanqi Mutual Entertainment Company

Diversification strategy is a market strategy measure employed in enterprise operations to capture new markets and explore new ones. It also serves as a strategic plan for enterprises to avoid risks encountered during operations of a single business. The strategy involves targeted and preparatory entry into new business fields. Implementing a diversification strategy in game companies can effectively improve company performance and bring about a transformation from quantitative to qualitative growth in the development of game companies.

1. The Macro Background of Diversification Strategy

Stepping into 2021, under the strong control of the pandemic by the nation, people's lives have returned to normal, and economic culture is also showing a favorable recovery trend. On April 30, 2021, according to related data published by the National Bureau of Statistics, the development of the national cultural industry has basically returned to pre-pandemic levels [1]. This is very favorable news for the game industry, which occupies a large proportion of the cultural industry. Although the arrival of the pandemic did not greatly affect the game industry, the inability to conduct offline activities always impacts the performance of game companies. With the recovery of the cultural industry, for most game companies, this signifies that the major development and prosperity of the cultural industry can promote more game companies to embark on a path of sustainable development [2].

From the outbreak of the pandemic last year to its stabilization now, the nation has promulgated relevant policies from various aspects such as finance, institutions, and finance to support the development of the cultural industry. The pandemic may have hindered people's footfall, but it couldn't control the spread speed of online networks. An increasing number of new media emerged promoting the development of the cultural industry during pandemic prevention, yet the competitive environment among cultural industries became extremely fierce as each company attempted to break into the online market. Many traditional offline enterprises couldn't withstand the impact of the pandemic and were socially eliminated, but within these short two years, many cultural industries successfully transformed. These companies largely relied on diversification strategic modes to accelerate transformation and upgrades, achieving significant gains during the pandemic prevention period with citizens' consumption levels notably improved, obtaining more diverse development modes and funding income channels. For instance, the transformation made by Sanqi Mutual Entertainment during the pandemic prevention period is worth emulating for most game companies [3].

2. Brief Analysis and Classification of Diversification Strategy

(a) Brief Analysis of Diversification Strategy

Diversification strategy was proposed by the pioneer of strategic management, Igor Ansoff. In his book "What is Corporate Strategy," he mentioned the classification of diversification strategy. This globally influential strategic mode has been involved in management policies of various countries, leading to every enterprise striving for a place according to the development mode of diversification strategy today [4].

(b) Classification and Meaning of Diversification Strategy

Diversification strategy is divided into four types: horizontal diversification, vertical integration, concentric diversification, and conglomerate diversification. The meanings of the four different modes derived from diversification strategy vary: horizontal diversification refers to enterprises utilizing market's original conditions to produce new products that meet users' new needs, thereby driving market consumption; vertical integration involves enterprises deriving vertically according to their development status, utilizing the product industry chain to infiltrate other market fields to seek new consumption targets; concentric diversification emphasizes innovation of existing technology, requiring production of new products within the existing production range, achieving transformation through existing technology evolution; conglomerate diversification focuses more on expanding business scope variation, enterprises need to connect raw materials, technologies related to their products, and market factors to expand business scopes [5].

3. The Impact of Diversification Strategy on Game Company Performance

It can be said that in the operation process of all game companies, the impact of diversification strategy on game company performance is uniformly divided into two parts: the change in operation mode and the transition of strategic planning. The effects gradually produced from these two parts drive the company's performance enhancement. The influence brought by diversification strategy is multifaceted. This paper will use Sanqi Mutual Entertainment Game Company as an example to analyze the impact of diversification strategy on game company performance [6].

(1) Change in Operation Mode

Currently, the main operational scope of Sanqi Mutual Entertainment Game Company is very broad, which is also the advantage brought by diversification strategy. The company's business not only involves interactive entertainment operations, but also fully covers the research and distribution of mobile games and web games. In recent development, constantly innovating to keep pace with technological advancement, it has expanded the market to include film layout and anime subcultures, shaping the market culture industry chain of Sanqi Mutual Entertainment Game Company in music, VR technology, and various live entertainment businesses.

The Sanqi Mutual Entertainment Game Company was founded in 1995, but the early development path was not smooth. The company's predecessor was a small enterprise, initially the industrial chain of Sanqi Mutual Entertainment did not include the operation of games and entertainment industries, constantly facing the risk of being swallowed by the market. However, relying on the steady development of the single industry, Sanqi Mutual Entertainment Company went public in 2011, but accompanying later poor operations and market contraction, Sanqi Mutual Entertainment ultimately couldn't escape the fate of being acquired. 𝑓𝑟ℯ𝘦𝓌𝘦𝘣𝑛𝑜𝓋𝑒𝓁.𝑐ℴ𝓂

In 2014, Wuhu Shunrong Auto Parts Co., Ltd. acquired Shanghai Sanqi Mutual Entertainment Technology Co., Ltd. with sixty percent equity. Despite being acquired nominally, for Sanqi Mutual Entertainment, this was an opportunity to seize for development. The two companies completed asset restructuring of various industries through multi-faceted collaboration. It's worth mentioning that the strategic management continually operated by Sanqi Mutual Entertainment started to show its prominence at this time, transitioning from a single modern cultural creative company before acquisition to a listed company with dual main businesses merging advanced production manufacturing and modern cultural creativity. Corresponding to this transition, the company's operational strategy also underwent changes, expanding the scope previously covered by cultural creative industries.