This Lord is Very Scientific-Chapter 744 - 676

(Anti-theft, will be sent in due course.) Abstract: With the advancement of technology and intelligent network coverage, the recent rise of the gaming industry is evident to the public. The methods of game dissemination are no longer restricted to stereotypes, and the influence of games has gradually expanded to all aspects of life. Correspondingly, game companies need to continually integrate resources, innovate, update, and improve performance in line with the rapid development of the times. The diversification strategy precisely aligns with the planning needs and development goals within the gaming industry. Under the background of economic globalization, the diversification strategy, as the preferred model for corporate development, is equally applicable to game companies. This article illustrates the impact of diversification strategy on the performance of game companies, using Sanqi Mutual Entertainment Company as an example.

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

A diversification strategy is a strategic market approach adopted by businesses during their operations to occupy new markets and expand into new markets. It is also a strategic planning adopted by businesses to dodge the risks encountered during the operation of a single venture and to enter a new business field with targeted and prepared measures. Implementing diversification strategy in game companies can effectively improve company performance, bringing about a process from quantitative change to qualitative change in the development of game companies.

1. Macroeconomic background of diversification strategy

Entering 2021, under the effective control of the pandemic by the nation, people's lives have returned to normal, and the economy and culture are presenting a thriving recovery landscape. On April 30, 2021, data released by the National Bureau of Statistics showed that the overall development of the national cultural industry has basically recovered to the pre-pandemic level [1]. This is very favorable news for the gaming industry, which occupies a significant portion of the cultural industry. Although the pandemic did not greatly affect the gaming industry, the inability to carry out offline activities still impacted the performance of game companies. The revival of the cultural industry implies that the great development and flourishing of the cultural industry can drive more game companies onto the path of sustainable development [2].

From last year's pandemic outbreak to the current stabilization, the nation has issued supportive policies from multiple aspects like finance, system, and capital to promote cultural industry development. Although the pandemic halted people's travels, it couldn't control the online dissemination speed. More and more new media emerged, driving cultural industry development during pandemic prevention and control. However, as various enterprises rush to enter the online market, the competitive environment of the cultural industry is extremely fierce. Numerous traditional offline enterprises could not withstand the pandemic's impact and were eliminated by society. However, during these short two years, many successfully transforming cultural industries emerged, most relying on diversification strategy models to accelerate transformation and upgrade, making significant gains during the period of increased resident consumption levels. They have obtained more diverse development modes and sources of fund income, and Sanqi Mutual Entertainment Company's transformation during pandemic prevention and control is worth learning from for most game companies [3].

2. Brief analysis and classification of diversification strategy

(a) Brief analysis of diversification strategy

Diversification strategy was proposed by Igor Ansoff, the pioneer of strategic management. In his book "Corporate Strategy," he mentioned the classification of diversification strategies. This world-impacting strategic model is involved in policy directions of several countries, leading to every enterprise now, big or small, seeking a place according to the diversification strategy development model [4].

(b) Classification and meaning of diversification strategy

There are four types of diversification strategies: horizontal diversification, vertical integration, concentric diversification, and conglomerate diversification. The four different models derived from the diversification strategy have distinct meanings. Horizontal diversification refers to enterprises utilizing original market conditions to produce new products that meet new user demands, thereby driving market consumption; vertical integration is enterprises spreading vertically based on their development status, penetrating the product industry chain into other market fields to seek new consumer targets; concentric diversification emphasizes the innovation of existing technologies, requiring the production of new products within the existing production scope and realizing transformation through existing technology; conglomerate diversification emphasizes range change expansion, enterprises need to connect factors related to their products such as raw materials, technology, and market to expand the scope of operations [5].

3. Impact of diversification strategy on the performance of game companies

In all game company operations, the impacts of diversification strategy on game company performance are uniformly divided into two parts: the change in operation mode and the shift in strategic planning. From the structure of these two parts, effects gradually emerge, driving the improvement in company performance. The impacts brought by diversification strategy are multifaceted. This thesis will analyze and research the impact of diversification strategy on game company performance, taking Sanqi Mutual Entertainment Game Company as an example [6].

(1) Change in operation mode

Currently, the main operating scope of Sanqi Mutual Entertainment Game Company is very extensive, which takes advantage of the benefits brought by the diversification strategy. The company's business not only involves interactive entertainment operations but also undertakes the research and publication of mobile and web games. In recent years, it has been constantly innovating with the era of technology, broadening market layouts to films and anime, and is shaping the market cultural industry chain belonging to Sanqi Mutual Entertainment Game Company within music, VR technology, and various other entertainment businesses.

Sanqi Mutual Entertainment Game Company was founded in 1995, but its initial development path was not smooth. The predecessor of Sanqi Mutual Entertainment Game Company was a small enterprise, and initially, its industry chain did not involve game and other entertainment industry operations, facing the risk of being merged by the market at any time. However, relying on the steady development of a single industry, Sanqi Mutual Entertainment Company listed in 2011. Nevertheless, following poor operations and market tightening later on, Sanqi Mutual Entertainment ultimately couldn't escape the fate of being acquired.

In 2014, Wuhu Shunrong Auto Parts Co., Ltd. acquired 60% equity in Shanghai Sanqi Mutual Entertainment Technology Co., Ltd. Despite the nominal acquisition, it was a development opportunity worth seizing for Sanqi Mutual Entertainment. Under multi-faceted coordination, the two companies completed asset restructuring across various industries. It is noteworthy that the operational strategies consistently implemented by Sanqi Mutual Entertainment have shown initial success by this time. Sanqi Mutual Entertainment Company transformed from a single modern cultural creative company pre-acquisition to a dual-main business listed company of advanced manufacturing and modern cultural creativity concurrently. Correspondingly, Sanqi Mutual Entertainment's company operational strategies are also undergoing changes, from the business range covered by the original cultural and creative industry. In 2014, the business range covered by the original cultural and creative industry by Wuhu Shunrong Auto Parts Co., Ltd.