This Lord is Very Scientific-Chapter 760 - 692

(Anti-theft, to be released later.) Abstract: With the advancement of technology and the coverage pattern of intelligent networks, the rise of the gaming industry in recent years is evident to the public. The dissemination of games is no longer confined to rigid promotional models, and the influence of games has gradually expanded to all aspects of life. Correspondingly, game companies need to continuously integrate resources and innovate to improve performance in line with the rapid development of the times. A diversification strategy precisely meets the planning needs and development goals within the gaming industry. In the context of economic globalization, the diversification strategy, as the preferred model for enterprise development, is equally applicable to gaming companies. This paper takes Sanqi Mutual Entertainment Company as an example to explain the impact of diversification strategy on the performance of gaming companies.

Keywords: Diversification strategy; Game company; Performance; Impact; Sanqi Mutual Entertainment Company

Diversification strategy is a market strategy measure taken by enterprises during the operation process to capture more new markets and develop new markets. It is also a strategic plan for enterprises to avoid the risks encountered when operating a single business and to deliberately enter new business fields. Applying diversification strategy practically to gaming companies can effectively enhance company performance, bringing a process of quantitative to qualitative change to the development of gaming companies.

1. The Macroeconomic Background of Diversification Strategy

Entering 2021, under the strong control of the pandemic by the state, people's lives have returned to normal, and the economic and cultural spheres have shown a great trend of recovery. On April 30, 2021, according to relevant data published by the National Bureau of Statistics, the development of the national cultural industry has basically returned to pre-pandemic levels [1]. This is very favorable news for the gaming industry, which accounts for a large proportion of the cultural industry. Although the arrival of the pandemic did not cause significant impact on the gaming industry, the inability to carry out offline activities has always affected the performance of gaming companies. The recovery of the cultural industry indicates that the great development and prosperity of the cultural industry can promote and drive more gaming companies towards sustainable development [2].

From the outbreak of the pandemic last year to the current stabilization, the country has issued relevant policies from multiple aspects such as finance, regulations, and finance to support the development of the cultural industry. Although the pandemic has halted people's travel, it has not controlled the transmission speed of the online network. More and more new media have emerged, driving the development of the cultural industry during the pandemic prevention period. However, the competition environment among cultural industries is extremely fierce as various enterprises are eager to enter the online market. Many traditional offline enterprises could not withstand the impact of the pandemic and were eliminated by society. Still, in this short period of two years, many culturally transformative industries have emerged, most of which relied on the diversification strategy model to accelerate transformation and upgrading. During the pandemic prevention period, when the residents' consumption levels increased significantly, they also reaped considerable benefits, obtaining more diverse development models and channels for fund income. For example, Sanqi Mutual Entertainment's transformation during the pandemic prevention period is worth learning for most gaming companies [3].

2. Brief Analysis and Classification of Diversification Strategy

(1) Brief Analysis of Diversification Strategy

Diversification strategy was proposed by the father of strategic management, Igor Ansoff. In his book "Corporate Strategy," he mentioned the classification of diversification strategies. This strategic model influences the global policy of various management paths, so that today every enterprise, big or small, is seeking a place according to the diversification strategy development model [4].

(2) 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 modes derived from the diversification strategy also have different meanings. Horizontal diversification refers to enterprises producing new products that can meet new demand using the original conditions provided by the market to drive consumption; vertical integration refers to enterprises deriving vertically according to their own development situation and penetrating other market fields through the product industry chain to seek new consumer choices; concentric diversification focuses more on the innovation of existing technology, requiring the production of new products within the original scope of production, and the entire process is realized through the transformation of original technology; conglomerate diversification pays more attention to the expansion of the operational scope, requiring the enterprise to link related raw materials, technologies and market factors of its own products to expand the operational 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 strategies on gaming company performance is uniformly divided into two parts: the change of operational models and the transfer of strategic planning. From these two parts, the reforms gradually produce effects to drive the enhancement 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) Change of Operational Models

Currently, the main operational scope of Sanqi Mutual Entertainment Game Company is very broad, which relies on the advantages brought by the diversification strategy. The company's business not only involves the operation of interactive entertainment but also undertakes the development and release of mobile and web games under Sanqi Mutual Entertainment Game Company. In recent years of development, it has continuously innovated by closely following the times and technologies, expanding the market to include films, animations, and the second dimension. It also creates its own market cultural industry chain in music, VR technology, and various live entertainment businesses.

Established in 1995, Sanqi Mutual Entertainment Game Company did not have a smooth development path in its initial stage. The predecessor of Sanqi Mutual Entertainment Game Company was a small enterprise. Initially, the industrial chain of Sanqi Mutual Entertainment did not involve the operation of games and other entertainment industries. There was always a 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 along 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% of the shares of Shanghai Sanqi Mutual Entertainment Technology Co., Ltd. Although it was nominally acquired, this was a development opportunity for Sanqi Mutual Entertainment worth seizing. Through multiple collaborations, the two companies completed asset restructuring in various industries. It is worth mentioning that the strategy, which Sanqi Mutual Entertainment has always operated, had already begun to show its edge at this time. Sanqi Mutual Entertainment Company was transformed from a single modern cultural creative company before being acquired into a dual-main business listed company that runs parallel to advanced production manufacturing and modern cultural creativity. Correspondingly, Sanqi Mutual Entertainment's company operation strategy is also undergoing changes from the business scope covered by the original cultural creative industry. In 2014, Wuhu Shunrong Auto Parts Co., Ltd. first covered the business scope of the cultural creative industry.