This Lord is Very Scientific-Chapter 829 - 761

(Anti-theft, will be sent later.) Abstract: With the advancement of technology and the coverage of intelligent networks, the rise of the gaming industry in recent years has made its dissemination methods no longer confined to traditional promotional models. Games have increasingly influenced all aspects of life, and accordingly, gaming companies need to continually integrate resources, innovate, and improve performance with the rapid development of the times. A diversification strategy perfectly caters to the planning needs and development goals within the gaming industry. In the context of economic globalization, diversification strategies serve as the preferable mode of development for enterprises and are equally applicable to gaming companies. This article explains the impact of diversification strategies on gaming company performance using Sanqi Mutual Entertainment Company as an example.

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

A diversification strategy is a market strategy used by enterprises during operations to capture new markets and expand existing ones. It also allows enterprises to avoid risks encountered during single-business operations by strategically entering new business fields. Implementing diversification strategies in gaming companies can effectively enhance corporate performance, contributing to a transformation from quantitative to qualitative development.

1. The Macro Background of Diversification Strategy

As we enter 2021, with the country's effective control of the pandemic, people's lives are returning to normal, and the economy and culture are showing great signs of recovery. On April 30, 2021, according to data released by the National Bureau of Statistics, national cultural industry development had basically returned to pre-pandemic levels[1]. This is very favorable news for the gaming industry, which accounts for a significant portion of the cultural sector. Although the pandemic did not severely impact the gaming industry, the inability to conduct offline activities has still affected gaming company performance. The warming of the cultural industry means that for most gaming companies, this resurgence can promote and drive more gaming companies onto a path of sustainable development[2].

Since the outbreak of last year's pandemic to the current stabilization, the nation has issued supportive policies for cultural industry development from various aspects such as finance, systems, and finance. Although the pandemic has hindered people's travel, it has not controlled the speed of online network communication. More and more new media have emerged, driving cultural industry development during the pandemic. However, the competition environment within the cultural industry is extremely fierce as all enterprises aim to enter the online market. Many traditional offline enterprises have not withstood the pandemic's impact and have been eliminated by society. Yet, in these short two years, many successfully transformed cultural industries have emerged, relying mostly on diversification strategy models for accelerated transformation and upgrading. During the pandemic control period, with a significant increase in consumer levels, they have also reaped substantial benefits, gaining a more diversified development model and revenue channels. For instance, Sanqi Mutual Entertainment Company's transformation during the pandemic control period is worth emulating by 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 work "Corporate Strategy," he mentioned the classification of diversification strategies. This globally influential strategic model is reflected in management strategies and policies in numerous countries, leading every enterprise, large and small, to seek a place according to diversification strategy development models[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 meanings of the four derived models from diversification strategy vary. Horizontal Diversification refers to enterprises utilizing the market's provided original conditions to produce new products that satisfy users' new demands, thus driving market consumption; Vertical Integration refers to enterprises vertically deriving based on their development status, penetrating other market sectors with their product industry chains to seek new consumer targets; Concentric Diversification focuses more on innovation of existing technology, requiring new product production within the original production scope, with the entire process realized through the transformation of existing technology; Conglomerate Diversification emphasizes expanding operational range changes, requiring enterprises to connect raw materials, technology, market, and other factors related to their products to expand operational range[5].

3. The Impact of Diversification Strategy on Gaming Company Performance

In the operation processes of all gaming companies, the impact of diversification strategy on gaming company performance is unified into two parts: the change in operational modes and the shift in strategic planning. The effect gradually generated from these two sections drives performance improvement. The impact of diversification strategy is multifaceted. This paper will take Sanqi Mutual Entertainment Game Company as an example to analyze the impact of diversification strategy on gaming company performance[6].

(1) Change in Operational Modes

Currently, Sanqi Mutual Entertainment Game Company's primary operational scope is very extensive, which is an advantage brought by diversification strategy. The company's business not only involves the operation of interactive entertainment but also fully owns the R&D and distribution of mobile games and web games. In recent development, the company consistently innovates, keeping up with era technology to expand its market to layout film, animation, the second dimension, and also creating its market cultural industry chain across music, VR technology, and various generic entertainment businesses such as live streaming.

Established in 1995, Sanqi Mutual Entertainment Game Company did not have a smooth path in its early development stages. Initially, the predecessor of Sanqi Mutual Entertainment Game Company was a small enterprise, with its industrial chain not involving game and other entertainment industry operations until market swallowed risks were constantly present. With steady development, Sanqi Mutual Entertainment Company went public in 2011, but with poor operation and market contraction in later stages, Sanqi Mutual Entertainment eventually could not escape acquisition.

In 2014, Wuhu Shunrong Auto Parts Co., Ltd. acquired 60% equity in Shanghai Sanqi Mutual Entertainment Technology Co., Ltd. Although nominally acquired, for Sanqi Mutual Entertainment, this was a development opportunity to grasp. The two companies completed various industrial asset restructuring through multi-party cooperation. Notably, the strategy long operated by Sanqi Mutual Entertainment began to show prominence at this time. Sanqi Mutual Entertainment Company transformed from a pre-acquisition single modern cultural creativity company to the present dual-main business listed company combining advanced production manufacturing and modern cultural creativity. Correspondingly, Sanqi Mutual Entertainment's corporate operation strategy underwent changes. The business scope covered by the original cultural creativity industry. In 2014, the business scope covered by Wuhu Shunrong Auto Parts Co., Ltd.'s original cultural creativity industry.