This Lord is Very Scientific-Chapter 754 - 686

(Anti-theft, to be posted 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 everyone. The way games are spread is no longer confined to rigid promotional modes, and the influence of games has gradually expanded to all aspects of life. Correspondingly, gaming companies need to continuously integrate resources, innovate and update, and improve performance as the times develop rapidly. Diversification strategy precisely meets the planning needs and development goals within the gaming industry. Against the backdrop of economic globalization, diversification strategy, as the preferred mode of corporate development, is equally applicable to gaming companies. This article explains the impact of diversification strategy on the performance of gaming companies using Sanqi Mutual Entertainment Company as an example.

Keywords: Diversification Strategy; Gaming Company; Performance; Impact; Sanqi Mutual Entertainment

Diversification strategy is a market strategy employed by enterprises in the process of operation to capture more new markets and develop new markets. It is also a strategic planning used by enterprises to enter new business fields with targeted and prepared measures to avoid risks encountered in operating a single business. Applying diversification strategy practically in gaming companies can effectively improve company performance, bringing about a process from quantitative change to qualitative change in the development of gaming companies.

1. The macro background of diversification strategy

As we step into 2021, with the effective control of the pandemic by the state, people's lives are back on track, and the economic and cultural aspects are showing a great trend of recovery. On April 30, 2021, according to 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 particularly good news for the gaming industry, which accounts for a large proportion of the cultural industry. Although the pandemic did not significantly impact the gaming industry, the inability to conduct offline activities has always affected the performance of gaming companies. The recovery of the cultural industry means that the great development and prosperity of the cultural industry can drive more gaming companies to embark on a path of sustainable development for most gaming companies[2].

From the outbreak of the pandemic last year to the current stability of the epidemic, 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 has hindered people's travel, it cannot control the speed of online network dissemination. More and more new media have emerged, driving the development of the cultural industry during the pandemic prevention period, but companies are eager to break into the online market, making the competition environment within the cultural industry very fierce. Many traditional offline companies have been eliminated by society due to the impact of the pandemic at this time. However, in just these two years, many cultural industries have successfully transformed. Most of these companies rely on the diversification strategy mode to accelerate transformation and upgrading, gaining diverse development models and funding income channels during the pandemic prevention period when residents' consumption levels have significantly improved. For example, the transformation made by Sanqi Mutual Entertainment Company during the pandemic prevention period is worth learning from for most gaming companies[3].

2. A brief analysis and classification of diversification strategy

(1) Brief analysis of diversification strategy

Diversification strategy was proposed by the pioneer of strategic management, Igor Ansoff. In his book "Corporate Strategy," he mentioned the classification of diversification strategy. This strategy model, which affects the world, is involved in the management policy of many countries, so that today every enterprise, large or small, seeks a place in the development mode of diversification strategy[4]. 𝘧𝓇𝑒𝑒𝑤ℯ𝑏𝓃𝘰𝑣ℯ𝘭.𝘤ℴ𝘮

(2) Classification of diversification strategy and its meaning

There are four types of diversification strategy: horizontal diversification, vertical integration, concentric diversification, and conglomerate diversification. The derived four modes of diversification strategy have different meanings. Horizontal diversification refers to the enterprise using the original conditions provided by the market to produce new products that meet the new needs of users, thereby driving market consumption; vertical integration is the enterprise's vertical derivation based on its development situation, using the product industry chain to penetrate other market fields to seek new consumers; concentric diversification focuses more on the innovation of existing technology, requiring the production of new products within the original production range, achieving the entire process through the transformation of existing technology; conglomerate diversification focuses more on expanding the scope of business changes. Enterprises need to contact products, original materials, technologies, and market factors related to themselves to expand their business scope[5].

3. The impact of diversification strategy on the performance of gaming companies

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

(1) Changes in operating modes

At present, the main operating scope of Sanqi Mutual Entertainment Game Company is very broad, which is also the advantage brought by the diversification strategy. In addition to the operation of interactive entertainment, the company also handles the research and development, and distribution of mobile and web games under the Sanqi Mutual Entertainment Game Company. Moreover, in recent years, the company has kept pace with technological advancements and continuously innovated, expanding its market to the layout of film and anime, and also building a cultural industry chain that belongs to Sanqi Mutual Entertainment Game Company in music, VR technology, and various live broadcasting and other pan-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 the operation of games and other entertainment industries, facing the risk of being annexed by the market at any time. However, relying on the steady development of a single industry, Sanqi Mutual Entertainment Company was listed in 2011. Nevertheless, with the poor later operation and market squeeze, Sanqi Mutual Entertainment ultimately did not escape the fate of being acquired.

In 2014, Wuhu Shunrong Auto Parts Co., Ltd. acquired 60% of the shares of Shanghai Sanqi Mutual Entertainment Technology Co., Ltd. Although it was acquired in name, it was an opportunity worth seizing for Sanqi Mutual Entertainment. The two companies completed the restructuring of various industry assets through multi-party cooperation. It is worth mentioning that the strategy that Sanqi Mutual Entertainment has been implementing has begun to show its strength. Sanqi Mutual Entertainment Company transformed from a single modern cultural and creative company before the acquisition into a dual-listed company with advanced production manufacturing and modern cultural creativity running concurrently. Correspondingly, the company's operation strategy of Sanqi Mutual Entertainment has also undergone changes in the business scope covered by the original cultural and creative industry. In 2014 Wuhu Shunrong Auto Parts Co., Ltd.'s cultural and creative industry business scope was covered by the original range.