This Lord is Very Scientific-Chapter 817 - 749

(Anti-theft, to be published later.) Abstract: With the advancement of technology and the pervasive coverage of intelligent networks, the rise of the gaming industry in recent years has been evident to the public. The mode of spreading games is no longer confined to rigid promotional methods, and the influence of games has gradually expanded to various aspects of life. Correspondingly, gaming companies must continually integrate resources, innovate and iterate to enhance performance in response to the rapid development of the times. Diversification strategy precisely aligns with the planning needs and development goals within the gaming industry. In the context of economic globalization, diversification strategy, as the preferred mode of enterprise development, is equally applicable to gaming companies. This article explains the impact of diversification strategy on gaming company performance using Sanqi Mutual Entertainment Company as an example.

Keywords: Diversification strategy; gaming company; performance; impact; Sanqi Mutual Entertainment Company

Diversification strategy is a market strategy means employed by enterprises to capture new markets and expand existing markets. It is also a strategic plan used by enterprises to avoid risks encountered in operating a single business and to enter new business fields with focus and preparation. Applying diversification strategy to gaming companies can effectively improve company performance, bringing a process of transition from quantitative change to qualitative change in the development of gaming companies.

1. The macro background of diversification strategy

Entering 2021, with the country's strong control over the pandemic, people's lives have resumed normalcy, and economic and cultural recovery is in full swing. On April 30, 2021, according to 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 very favorable news for the gaming industry, which holds a large share within the cultural industry. Although the onset of the pandemic did not greatly affect the gaming industry, the inability to conduct offline activities has always impacted gaming company performance. With the cultural industry's recovery, this means the great development and prosperity of the cultural industry can drive many gaming companies onto a path of sustainable development[2].

From last year's outbreak of the pandemic to the current stabilization, the country has promulgated relevant policies supporting cultural industry development from multiple aspects such as finance, systems, and finance. Although the pandemic has hindered people's travels, it cannot control the speed of online network dissemination. The emergence of increasingly more new media has driven cultural industry development during pandemic control. However, as many enterprises attempt to enter the online market, leading to intense competition within the cultural industry, many traditional offline enterprises have been unable to withstand the pandemic's impact and have been eliminated by society. Yet within these short two years, numerous successful transformations in the cultural industry have emerged, relying on diversification strategy models to expedite their transformation and upgrading, and during the pandemic control period, when resident consumption levels have significantly increased, they have also gained substantial returns, acquiring more diverse development models and funding sources, such as the transformation made by Sanqi Mutual Entertainment Company during the pandemic control period, which is worthy of learning by most gaming companies[3].

2. Brief analysis and classification of diversification strategy

(a) 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 policies across multiple countries, resulting in every enterprise, small or large, seeking a place following the development model of diversification strategy today[4].

(b) Classification and meaning of diversification strategy

Diversification strategy is divided into four types: horizontal diversification, vertical integration, concentric diversification, and complete diversification. The four different modes derived from diversification strategy have different meanings. 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 enterprises deriving vertically according to their own development situation, using the product industry chain to penetrate into other market fields and seek new consumers. Concentric diversification pays more attention to the innovation of existing technologies and requires the production of new products within the existing production scope; the entire process requires enterprises to contact and link raw materials and technology related to existing products and market factors to expand their business scope[5].

3. Impact of diversification strategy on gaming company performance

In all gaming company operations, the impact of diversification strategy on gaming company performance can be divided into two parts: changes in operational mode and shifts in strategic planning. From these two parts, changes gradually produce effects that enhance company performance. The impact brought by diversification strategy is multifaceted. This paper will use Sanqi Mutual Entertainment Game Company as an example to analyze the influence of diversification strategy on gaming company performance[6]. 𝗳𝚛𝗲𝕖𝕨𝕖𝗯𝚗𝚘𝕧𝕖𝗹.𝗰𝗼𝕞

(1) Changes in operational mode

Currently, the main operational scope of Sanqi Mutual Entertainment Game Company is very broad; this is also dependent on the advantages brought by diversification strategy. The company not only involves the operation of interactive entertainment but also handles the research and distribution of mobile games and web games under Sanqi Mutual Entertainment Game Company. In recent developments, it has continually innovated by keeping up with technological advancements, expanding the market to layout film, anime, and second dimension, and establishing a 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 its early development path wasn't smooth. The predecessor of Sanqi Mutual Entertainment Game Company was a small-scale enterprise, initially not involving the operation of games and other entertainment industries in its industrial chain, always at risk of being annexed by the market. However, relying on the steady development of its single industry, Sanqi Mutual Entertainment Company went public in 2011. Yet with poor operational performance and market contraction in later years, Sanqi Mutual Entertainment ultimately couldn't escape the fate of acquisition.

In 2014, Wuhu Shunrong Auto Parts Co., Ltd. acquired Shanghai Sanqi Mutual Entertainment Technology Co., Ltd. with sixty percent equity. Although nominally acquired, this was a development opportunity worth seizing for Sanqi Mutual Entertainment. The two companies completed asset restructuring of various industries through multifaceted collaboration. It is worth mentioning that the strategic operations that Sanqi Mutual Entertainment Company has been running were beginning to show their edge, transitioning from a singular modern cultural creative company before acquisition to a currently double-main business listed company of advanced manufacturing and modern cultural creativity side by side. Correspondingly, Sanqi Mutual Entertainment's company operational strategy is also undergoing changes in the scope previously covered by the cultural creative industry. It should be noted that Sanqi Mutual Entertainment Company from before the acquisition was a single modern cultural creative company.