This Lord is Very Scientific-Chapter 741 - 673

(Prevent theft, send later.) Abstract: With the advancement of technology and the coverage model of intelligent networks, the rise of the gaming industry in recent years has been evident to the populace. The propagation of games is no longer constrained by rigid promotional modes, and the influence of games has gradually expanded to all aspects of life. Correspondingly, gaming companies must continuously integrate resources, innovate and iterate, and improve performance to keep pace with the rapid development of the times. A diversification strategy aptly meets the planning needs and development goals within the gaming industry. Against the backdrop of economic globalization, diversification strategy, as the preferred mode of enterprise development, is also applicable to gaming companies. This article uses Sanqi Mutual Entertainment Company as an example to explain the impact of diversification strategy on the performance of gaming companies.

Keywords: diversification strategy; gaming company; performance; impact; Sanqi Mutual Entertainment Company

Diversification strategy is a market strategy tool adopted by enterprises in the course of operation to capture more new markets and explore new markets. It is also a strategic plan employed by enterprises to avoid risks encountered in the operation of single businesses and to enter new business fields with targeting and preparation. Applying diversification strategy practically to gaming companies can effectively improve company performance and bring about a process of qualitative transformation from quantitative change for the development of gaming companies.

1. The macro background of the diversification strategy

Entering 2021, under the strong control over the pandemic by the government, people's lives have returned to normal, and the economy and culture are showing a promising recovery trend. On April 30, 2021, according to the relevant data released by the National Bureau of Statistics, the development of the national cultural industry has basically returned to pre-pandemic levels [1]. This is very positive news for the gaming industry, which accounts for a significant proportion of the cultural industry. Although the arrival of the pandemic did not have a significant impact on the gaming industry, the inability to conduct offline activities always affects the performance of gaming companies. With the warming of the cultural industry, for most gaming companies, this means that the great development and great prosperity of the cultural industry can promote and drive more gaming companies to embark on a path of sustainable development [2].

From last year's outbreak of the pandemic to the current stability of the pandemic, the government has promulgated relevant policies from finance, systems, and finance, among others, to support the development of the cultural industry. Although the pandemic has blocked people's travel, it cannot control the speed of online network transmission. More and more new media have emerged to drive the development of the cultural industry during the pandemic prevention period. However, because various enterprises want to crowd into the online market, the competitive environment within the cultural industry is very fierce. Many traditional offline enterprises have been unable to withstand the impact of the pandemic and have been eliminated by society at this time. But in this short period of two years, many successful transformations of cultural industries have also emerged, and most of these enterprises rely on the diversification strategy model to accelerate transformation and upgrade. During the pandemic prevention period, when the residents' consumption level significantly improved, they also harvested plentifully, gaining more diverse development models and income channels, such as the transformation made by Sanqi Mutual Entertainment Company during the pandemic prevention period, which is worth many gaming companies to learn from [3].

2. Brief analysis and classification of diversification strategy

(a) Brief analysis of diversification strategy

The diversification strategy was proposed by Igor Ansoff, the grandfather of strategic management. In his book "What is Corporate Strategy," he mentioned the classification of diversification strategies. This world-influencing strategic model is involved in management guidelines policies of multiple countries, so much so that today every enterprise, big or small, is seeking a place by following the development mode of diversification strategy [4].

(b) Classification and meanings of diversification strategy 𝐟𝗿𝐞𝚎𝚠𝐞𝚋𝕟𝐨𝚟𝐞𝕝.𝕔𝕠𝚖

The diversification strategy is divided into four types: horizontal diversification, vertical integration, concentric diversification, and overall diversification. The meanings derived from the four different modes of diversification strategy are also different. Horizontal diversification refers to enterprises producing new products that satisfy users' new demands using the original conditions provided by the market, thereby driving market consumption. Vertical integration refers to enterprises, according to their own development situation, deriving vertically, and infiltrating other market fields using the product industry chain to seek new consumer groups. Concentric diversification emphasizes the innovation of existing technology, requiring the production of new products within the existing production range, and the entire process is achieved through the transformation of existing technology. Overall diversification pays more attention to the expansion of operating range changes, requiring enterprises to connect factors such as raw materials, technology, and market related to their products to expand the operating range [5].

3. Impact of diversification strategy on gaming company performance

It can be said that in the operation process of all gaming companies, the impact of diversification strategy on gaming company performance is uniformly divided into two parts: changes in operating modes and shifts in strategic planning. From these two parts of change, effects gradually occur to drive the improvement of company performance. The impact of the diversification strategy is multifaceted. This paper will take Sanqi Mutual Entertainment Game Company as an example to analyze and study the impact of diversification strategy on gaming company performance [6].

(1) Changes in operating modes

Currently, the main operating scope of Sanqi Mutual Entertainment Game Company is very extensive, which is also relying on the advantages brought by the diversification strategy. The company's business not only involves interactive entertainment operations, but Sanqi Mutual Entertainment Game Company also wholly undertakes the research and development and distribution of mobile games and web games. In recent development, it continuously innovates by keeping pace with the era of technology, expands the market layout to film and anime ACGN, and also shapes the market cultural industry chain of Sanqi Mutual Entertainment Game Company in pan-entertainment businesses such as music, VR technology, and various live broadcasts.

Sanqi Mutual Entertainment Game Company was established in 1995, but in its early development road, it was not smooth sailing. The predecessor of Sanqi Mutual Entertainment Game Company was a small enterprise, and initially, Sanqi Mutual Entertainment's industry chain did not involve the operation of gaming and other entertainment industries, always facing the risk of being swallowed by the market. However, relying on the steady development of a single industry, Sanqi Mutual Entertainment Company went public in 2011. But following poor management and market constriction in later operations, Sanqi Mutual Entertainment ultimately couldn't escape the fate of being acquired.

In 2014, Wuhu Shunrong Auto Parts Co., Ltd. acquired 60% equity of Shanghai Sanqi Mutual Entertainment Technology Co., Ltd. Although nominally acquired, this was a development opportunity worth seizing for Sanqi Mutual Entertainment. The two companies completed asset restructuring of various industries through multi-party collaboration. It is worth mentioning that the exhibition strategy that Sanqi Mutual Entertainment has always operated had begun to show its edge at this time. Sanqi Mutual Entertainment Company transformed from a single modern cultural creative company before the acquisition to a dual-main business listed company with advanced production manufacturing and modern cultural creativity running parallel today. Correspondingly, the company's operational strategy is also changing, along with the original business scope covered by the cultural creative industry.