This Lord is Very Scientific-Chapter 812 - 744

(Anti-theft, will be sent 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 the public. The way games spread is no longer confined to rigid promotional models, 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 with the rapid development of the times to improve performance. The diversification strategy fits well with the planning needs and development goals within the gaming 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 uses Sanqi Mutual Entertainment Company as an example to explain the impact of diversification strategy on the performance of game companies.

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

Diversification strategy is a market strategy means adopted by enterprises in the process of operation to capture new markets and develop new markets further. It is also a strategic plan adopted to enter new business fields with focus and preparation to avoid risks encountered in the operation of a single business. Applying diversification strategy to game companies can effectively improve company performance, bringing about a transformation from quantitative to qualitative changes in the development of game companies.

1. Macro Background of Diversification Strategy

Stepping into 2021, under the strong control of the state over the pandemic, people's lives are on track, and the economy and culture show a good recovery trend. On April 30, 2021, according to data released by the National Bureau of Statistics, the national cultural industry development has basically recovered to pre-pandemic 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 pandemic did not cause the gaming industry much impact, the inability to carry out offline activities always affects the performance of game companies. With the warming of the cultural industry, this means that the great development and prosperity of the cultural industry can promote more game companies to embark on a path of sustainable development for most game companies [2].

From the outbreak of the pandemic last year to the stability of the pandemic now, the state has issued relevant policies in finance, system, finance, and other aspects to support the development of the cultural industry. Although the pandemic blocked people's travel, it could not control the speed of the online network's dissemination. More and more new media have emerged to promote the development of the cultural industry during the pandemic prevention and control period. However, as all enterprises want to squeeze into the online market, the competitive environment among the cultural industry is very fierce. Many traditional offline enterprises could not withstand the impact of the pandemic and were eliminated from society at this time. However, in just two years, many cultural industries have successfully transformed, and most of these enterprises rely on the diversification strategy model to accelerate transformation and upgrading. They also gained fruitful results during the pandemic prevention and control period, where residents' consumption levels significantly increased, and obtained more diverse development models and funding income channels. For example, the transformation that Sanqi Mutual Entertainment Company made during the pandemic prevention and control period is worth learning from by most game companies [3].

2. Brief Analysis and Classification of Diversification Strategy

(1) Brief Analysis of Diversification Strategy

Diversification strategy was proposed by Igor Ansoff, the founding father of strategic management. In his book "Corporate Strategy," he mentioned the classification of diversification strategy. This world-influencing strategic model is involved in management guidelines and policies of multiple countries. As a result, today, every large and small enterprise is seeking a place according to the development model of diversification strategy [4].

(2) Classification and Implications of Diversification Strategy

Diversification strategy is divided into four types: horizontal diversification, vertical integration, concentric diversification, and conglomerate diversification. The four different models derived from the diversification strategy have different implications. Horizontal diversification refers to enterprises using the original conditions provided by the market to produce new products that meet users' new needs, thereby driving market consumption. Vertical integration is when enterprises derive vertically according to their development status, utilize product industrial chains to penetrate other market fields to seek new consumer targets. Concentric diversification focuses more on innovation in original technology, needing to produce new products within the original production scope. The entire process is realized through the transformation of the original technology. Conglomerate diversification pays more attention to the expansion of the business scope changes. Enterprises need to connect with original materials, technology, and markets related to their products to expand the business scope [5].

3. Impact of Diversification Strategy on the Performance of Game Companies

It can be said that in the operation process of all game companies, the impact of diversification strategy on game company performance is unified into two parts: the change of operation mode and the shift of strategic planning. The effects gradually produced from these two parts drive the improvement of company performance. The impact 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 game companies [6].

(1) Change of Operation Mode

Currently, the main operation scope of Sanqi Mutual Entertainment Game Company is quite extensive, which is also due to the advantages brought by the diversification strategy. The company's business not only involves interactive entertainment operations but also undertakes the development and distribution of mobile games and web games under Sanqi Mutual Entertainment Game Company. In recent years, they have kept pace with the times and technology, continuously innovating, and expanding the market layout to film and animation in the ACG sector. They are shaping Sanqi Mutual Entertainment Game Company's market cultural industry chain in music, VR technology, and various live streaming, among other pan-entertainment businesses.

Sanqi Mutual Entertainment Game Company was established in 1995, but its initial development path was not smooth sailing. The predecessor of Sanqi Mutual Entertainment Game Company was a small enterprise. Initially, Sanqi Mutual Entertainment's industry chain did not involve game and other entertainment industry operations, and 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 went public in 2011. Nevertheless, with poor post-period operations and market contraction, Sanqi Mutual Entertainment still 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% equity acquisition. Although it was nominally acquired, for Sanqi Mutual Entertainment, this was a development opportunity worth grasping. The two companies completed asset restructuring of various industries under multi-party cooperation. It is worth mentioning that the strategic exhibition that Sanqi Mutual Entertainment has always operated on began to reveal its prowess at this time. Sanqi Mutual Entertainment Company transformed from a single modern cultural creative company before being acquired into today's dual-listed company with advanced production manufacturing and modern cultural creativity, and correspondingly, Sanqi Mutual Entertainment's company operation strategy has also been changing. The previous scope of business covered by the cultural creative industry. In 2014, the original scope of business covered by Wuhu Shunrong Auto Parts Co., Ltd.'s prior cultural creative industry.