This Lord is Very Scientific-Chapter 748 - 680

(Anti-theft, will be sent later.) Abstract: With the advancement of technology and the coverage model of intelligent networks, the rise of the game industry in recent years is evident to the public. The dissemination methods of games are no longer confined to rigid promotional modes, and the influence of games has gradually expanded to various aspects of life. Correspondingly, game companies also need to continuously integrate resources, innovate, and update to improve performance in line with the fast-paced development of the times. A diversification strategy precisely meets the planning needs and development goals within the game industry. In the context of economic globalization, the diversification strategy, as the preferred development model for enterprises, is also applicable to game companies. This article explains 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

The diversification strategy is a market strategy tool used by enterprises during their operations to capture new markets and expand into new markets. It is also a strategic planning adopted to avoid risks encountered in operating a single business by entering new business fields with targets and preparation. Applying a diversification strategy to game companies can effectively improve the company's performance, leading to a process of quantitative to qualitative change for the development of game companies.

1. Macroeconomic background of the diversification strategy

Entering 2021, with the effective control of the pandemic by the state, people's lives have returned to normal, and the economy and culture are showing a great trend of recovery. On April 30, 2021, according to related data released by the National Bureau of Statistics, the development of the national cultural industry has basically recovered to pre-pandemic levels[1]. This is highly favorable news for the game industry, which occupies a significant proportion of the cultural industry. Although the arrival of the pandemic did not have a major impact on the game industry, the inability to conduct offline activities has always affected the performance of game companies. The warming of the cultural industry means that the great development and prosperity of the cultural industry can drive more game companies onto the path of sustainable development[2].

From the outbreak of last year's pandemic to the current stability, the state has introduced relevant policies from multiple aspects such as finance, systems, and finance to support the development of the cultural industry. Although the pandemic halted people's travel, it could not control the spread speed of the online network. More and more new media are driving the development of the cultural industry during pandemic prevention, but because each company wants to enter the online market, the competitive environment within the cultural industry is extremely fierce. Many traditional offline companies could not withstand the impact of the pandemic and were eliminated by society, but within this short two-year time, numerous cultural industries successfully transformed and upgraded rapidly with the help of a diversification strategy, harvesting a rich reward during the pandemic prevention period when resident consumption levels significantly increased, and obtained more diversified development models and revenue channels. For example, the transformation made by Sanqi Mutual Entertainment during the pandemic prevention period is worth learning for most game companies[3].

2. Brief analysis and classification of diversification strategies

(1) Brief analysis of diversification strategies

The diversification strategy was proposed by Igor Ansoff, the pioneer of strategic management, in his book "Corporate Strategy." This world-influencing strategy model has been involved in management guidelines and policies of multiple countries, resulting in every large and small enterprise today seeking to secure a place according to the diversification strategy development model[4].

(2) Classification and meaning of diversification strategies

The diversification strategy is divided into four types: horizontal diversification, vertical integration, concentric diversification, and conglomerate diversification. The meanings of the four different models derived from the diversification strategy also vary. Horizontal diversification refers to enterprises utilizing the initial conditions provided by the market to produce new products that meet users' new demands, thereby driving market consumption; whereas vertical integration is when enterprises vertically derive based on their development, using product industry chains to penetrate other market areas seeking new consumer targets; concentric diversification focuses more on innovation of existing technology, requiring the production of new products within the original production range, achieving this through the metamorphosis of existing technology; conglomerate diversification emphasizes on expanding business range changes, enterprises need to connect related raw materials, technology, markets, and other factors of their own products to carry out the expansion of business scope[5].

3. Impact of diversification strategy on game company performance

It can be said that in the operational process of all game companies, the impact of the diversification strategy on game company performance is uniformly divided into two parts: change in operational model and shift in strategic planning. These changes gradually produce effects that drive company performance improvements. The impact brought by the diversification strategy is multi-faceted. This paper will take Sanqi Mutual Entertainment Game Company as an example to analyze and study the impact of the diversification strategy on game company performance[6].

(1) Change in operational model

Currently, the main operational range of Sanqi Mutual Entertainment Game Company is quite broad, which is also reliant on the advantages brought by the diversification strategy. The company's business not only involves the operation of interactive entertainment but also undertakes the research and publishing of mobile and web games. In recent years, keeping up with technological advancements and continuously innovating, it has expanded the market to the layout of film and anime ACG, and in music, VR technology, and various live streaming and other pan-entertainment businesses, it is shaping the market cultural industry chain belonging to Sanqi Mutual Entertainment Game Company.

Sanqi Mutual Entertainment Game Company was established in 1995, but in its early development path, it wasn't smooth sailing. The predecessor of Sanqi Mutual Entertainment Game Company was a small enterprise. At first, Sanqi Mutual Entertainment's industry chain did not involve the operation of entertainment industries such as games, with an ever-present 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. However, with poor operations and market constrictions later on, Sanqi Mutual Entertainment ultimately did not escape the fate of being acquired.

In 2014, Wuhu Shunrong Auto Parts Co., Ltd. acquired Shanghai Sanqi Mutual Entertainment Technology Co., Ltd. with a 60% stake. Although it was acquired nominally, for Sanqi Mutual Entertainment, this was a development opportunity worth seizing. Under multiparty collaboration, the two companies completed the restructuring of various industry assets. Notably, the strategy that Sanqi Mutual Entertainment was operating at that time was already starting to show its edge. Sanqi Mutual Entertainment Company transformed from a single modern cultural creative company before the acquisition into today's dual-pronged listed company with advanced manufacturing and modern cultural creativity running parallel. Accordingly, the company's operational strategy underwent changes, in the business scope of the original cultural creativity industry. In 2014, the business scope included in the original cultural creativity industry of Wuhu Shunrong Auto Parts Co., Ltd.