This Lord is Very Scientific-Chapter 758 - 690

(Anti-theft, will be sent at the time.) Abstract: With the advancement of technology and the coverage model of smart networks, the rise of the game industry in recent years is apparent to all citizens. The way games are disseminated is no longer confined to rigid promotional modes, and the influence of games has gradually expanded to all aspects of life. Correspondingly, gaming companies also need to continuously integrate resources, innovate, and improve performance with the rapid development of the times. A diversification strategy precisely caters to the planning needs and development goals within the gaming industry. In the context of economic globalization, the diversification strategy as a preferred mode of enterprise development is also 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 Company

Diversification strategy is a market strategic approach adopted by enterprises during operations to capture more new markets and explore new ones. It is also a strategic plan for enterprises to avoid risks encountered during the operation of a single business, entering new business fields with focus and preparation. Applying diversification strategy practically to gaming companies can effectively enhance company performance, bringing about a transformation from quantity to quality in the development process of gaming companies.

1. Macro Background of Diversification Strategy

Entering 2021, with the strong control of the epidemic by the state, people's lives have returned to normal, and economic and cultural aspects are showing a positive recovery. On April 30, 2021, according to relevant data released by the National Bureau of Statistics, the overall development of the national cultural industry has basically returned to pre-epidemic levels [1]. This is very favorable news for the gaming industry, which occupies a large proportion of the cultural industry. Although the arrival of the epidemic has not greatly affected the gaming industry, the inability to carry out offline activities continues to impact the performance of gaming companies. The recovery of the cultural industry means that the great development and prosperity of the cultural industry can promote and drive many gaming companies to embark on a path of continuous development [2].

From the outbreak of the epidemic last year to the current stabilization, the country has issued supportive policies for the development of the cultural industry from multiple aspects such as finance, systems, and finance. Although the epidemic hindered people's travel, it could not control the speed of online network dissemination. More and more new media emerged to drive the development of the cultural industry during the epidemic prevention and control period. However, since various enterprises aim to enter the online market, the competitive environment in the cultural industry is extremely fierce. Many traditional offline enterprises were eliminated from society due to the impact of the epidemic at this time, but many cultural enterprises successfully transformed during these two short years. These enterprises mostly relied on the diversification strategy model to accelerate transformation and upgrading. During the epidemic prevention and control period, when the level of resident consumption increased significantly, they also gained abundant benefits, acquiring more diverse development models and income channels. For example, Sanqi Mutual Entertainment's transformation during the epidemic prevention and control period is worth emulating by most gaming companies [3].

2. Brief Analysis and Classification of Diversification Strategy

(1) Brief Analysis of Diversification Strategy 𝚏𝕣𝐞𝗲𝐰𝕖𝐛𝐧𝕠𝕧𝚎𝚕.𝐜𝚘𝗺

Diversification strategy was proposed by Igor Ansoff, the ancestor of strategic management. In his book "Corporate Strategy", he mentioned the classification of diversification strategies. This world-influencing strategic model is involved in management guidelines and policies in many countries, leading to today's situation where every large and small enterprise is seeking a place through the development model of a diversification strategy [4].

(2) Classification and Meaning of Diversification Strategy

Diversification strategy is divided into four types: horizontal diversification, vertical integration, concentric diversification, and conglomerate diversification. The four different modes derived from diversification strategy also have different meanings. Horizontal diversification refers to enterprises using the original conditions provided by the market to produce new products that can meet new customer demands, thus driving market consumption. Vertical integration is the vertical derivation of enterprises based on their development status, using the product industry chain to penetrate into other market fields to seek new consumer targets. Concentric diversification focuses more on the innovation of existing technology, requiring production of new products within the original production range, realizing it through the transformation of existing technology. Conglomerate diversification emphasizes changes in operation scope expansion more, requiring enterprises to expand the operation scope by contacting factors related to their products such as raw materials, technology, and market [5].

3. 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 the performance of gaming companies is uniformly divided into two parts: the change of operation mode and the shift of strategic planning. The effect gradually occurs from these two parts of reform, driving the improvement of company performance. The influence brought by 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 the performance of gaming companies [6].

(1) Change of Operation Mode

Currently, the main operation scope of Sanqi Mutual Entertainment Game Company is very extensive, which is also an advantage brought by the diversification strategy. The company's business not only involves the operation of interactive entertainment but also fully handles the development and distribution of mobile games and web games under Sanqi Mutual Entertainment Game Company. In recent years, keeping up with the technological advancements of the times and continuously innovating, the company has expanded the market to include plans for film and animation, and has shaped the market cultural industry chain belonging to Sanqi Mutual Entertainment Game Company in music, VR technology, and various live entertainment businesses.

Sanqi Mutual Entertainment Game Company was established in 1995, but the initial development path was not smooth. The predecessor of Sanqi Mutual Entertainment Game Company was a small enterprise, and initially, the industrial 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 was listed in 2011, but with poor operations later and market contraction, Sanqi Mutual Entertainment ultimately did not 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, for Sanqi Mutual Entertainment, this was a developmental opportunity worth seizing. Through multi-party collaboration, the two companies completed the asset reorganization of various industries. It is worth mentioning that the strategy that Sanqi Mutual Entertainment has always implemented was shining at this time. Sanqi Mutual Entertainment Company transformed from a single modern cultural creative company before being acquired to a dual-main business listed company with advanced production manufacturing and modern cultural creativity in parallel. Correspondingly, the operating strategy of Sanqi Mutual Entertainment also underwent changes, adjusting the business scope covered by the original cultural creative industry.