This Lord is Very Scientific-Chapter 653 - 585: News of René Descartes! Huge Commotion!

(Anti-theft, will be sent later.) Abstract: With the advancement of technology and the coverage model of intelligent networks, the rise of the game industry in recent years is evident to all citizens. The dissemination of games no longer sticks to rigid promotional methods, and the influence of games has gradually expanded to all aspects of life. Correspondingly, game companies also need to continually integrate resources, innovate, and update with the rapid development of the times to improve performance. Diversification strategy aptly caters to the planning needs and development goals within the game industry. Against the backdrop of economic globalization, diversification strategy, as the preferred model for enterprise development, 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 companies; Performance; Impact; Sanqi Mutual Entertainment Company

Diversification strategy is a market strategy method that enterprises adopt in the operation process to occupy and explore new markets more broadly. It is also a strategic plan used by enterprises to enter new business fields with specific targets and preparations to avoid risks encountered in operating a single business. Applying diversification strategy practically to game companies can effectively improve company performance, bringing about a transformation from quantitative to qualitative changes in the development of game companies.

1. The Macro Background of Diversification Strategy

Entering 2021, under the effective control of the pandemic by the state, people's lives have returned to normal, and the economic culture shows a promising recovery trend. 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 game industry, which holds a large proportion in the cultural industry. Although the pandemic did not significantly affect the gaming industry, the inability to hold offline activities always impacted the performance of game companies. The warming of the cultural industry indicates that for most game companies, it means that the great development and prosperity of the cultural industry can promote more game companies to embark on the path of sustainable development [2].

From last year's outbreak to the current stabilization of the pandemic, the state has issued relevant policies to support cultural industry development from various aspects such as finance, systems, and finance. Although the pandemic halted people's travel, it could not control the speed of online network dissemination. More and more new media emerged, driving cultural industry development during the pandemic prevention period. However, due to various enterprises vying to enter the online market, the competitive environment within the cultural industry is extremely fierce. Many traditional offline enterprises could not withstand the impact of the pandemic and were eliminated by society. But in the short span of two years, many successfully transformed cultural industries also emerged. These enterprises largely relied on diversification strategy models to accelerate transformation and upgrading, reaping considerable benefits even during the pandemic prevention period of significantly increased resident consumption levels, obtaining more diverse development models and income channels. For example, Sanqi Mutual Entertainment's transformation during the pandemic prevention 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 father of strategic management, mentioned in his book "Corporate Strategy." This influential strategic model is involved in management policy guidelines in many countries, resulting in every enterprise, regardless of size, seeking a place according to the development model of diversification strategy today [4]. 𝐟𝕣𝕖𝐞𝐰𝕖𝚋𝐧𝗼𝚟𝐞𝕝.𝗰𝐨𝐦

(2) Classification and Meaning of Diversification Strategy

Diversification strategy is divided into four types: horizontal diversification, vertical integration, concentric diversification, and overall diversification. The four different model meanings derived from diversification strategy also vary. Horizontal diversification refers to enterprises using the original conditions provided by the market to produce new products that meet new user needs, thereby driving market consumption; vertical integration refers to enterprises deriving vertically based on their development status, using the product industry chain to penetrate other market fields to seek new consumer targets; concentric diversification focuses more on innovation of existing technology, requiring new product production within the original production range, achieving the process through the transformation of original technology; overall diversification focuses more on expanding changes in the business scope. Enterprises need to link related raw materials, technologies, and markets 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 operational process of all game companies, the impact of diversification strategy on game company performance is uniformly divided into two parts: changes in the operation model and shifts in strategic planning. The effects gradually generate from these two parts, driving the performance improvement of the company. The impact brought by diversification strategy is multi-faceted. This paper will analyze and study the impact of diversification strategy on the performance of game companies, taking Sanqi Mutual Entertainment Game Company as an example [6].

(1) Changes in the Operation Model

At present, the main operation range of Sanqi Mutual Entertainment Game Company is quite extensive, which is also an advantage brought by diversification strategy. The company's business not only involves the operation of interactive entertainment, but Sanqi Mutual Entertainment Game Company also wholly undertakes the research and distribution of mobile games and web games. Moreover, in recent years, along with technological advancements, it continues to innovate, expanding the market to layout film and anime ACG, shaping the market cultural industry chain belonging to Sanqi Mutual Entertainment Game Company in music, VR technology, and various live streaming and other pan-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 industry chain of Sanqi Mutual Entertainment did not involve the operation of games and other entertainment industries, facing the risk of being swallowed by the market at any time. However, relying on the steady development of a single industry, Sanqi Mutual Entertainment Company was listed in 2011. However, accompanied by poor later-stage operations and market shrinkage, Sanqi Mutual Entertainment eventually 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 it was nominally acquired, for Sanqi Mutual Entertainment, this was a development opportunity worth seizing. The two companies completed asset restructuring of various industries through multi-faceted cooperation. It is worth mentioning that the operational strategy that Sanqi Mutual Entertainment has been implementing had already begun to show its edge at this point. Sanqi Mutual Entertainment Company transformed from a single modern cultural creativity company before the acquisition to a dual-primary business listed company with advanced production manufacturing and modern cultural creativity in parallel. Correspondingly, the operational strategy of Sanqi Mutual Entertainment Company also underwent changes, and the business scope covered by the original cultural creativity industry...