This Lord is Very Scientific-Chapter 704 - 636
(Anti-theft, will be sent at that time.) Abstract: With the advancement of technology and the coverage mode of smart networks, the rise of the gaming industry in recent years has been evident to the public. The ways in which games are spread are no longer confined to rigid promotional modes, and the influence of games has gradually expanded to all aspects of life. Correspondingly, game companies need to continuously integrate resources, innovate, and iterate to improve performance along with the rapid development of the times. Diversification strategy perfectly aligns with the planning needs and development goals within the gaming industry. In the context of economic globalization, diversification strategy, as a preferred mode for enterprise development, is equally applicable to game companies. This article explains the impact of diversification strategy on game company performance using Sanqi Mutual Entertainment Company as an example.
Keywords: diversification strategy; game company; performance; impact; Sanqi Mutual Entertainment Company
Diversification strategy is a market strategy approach that enterprises adopt to capture more new markets and expand new markets during their operations. It is also a strategic plan for enterprises to avoid the risks encountered during the operation of a single business by entering new business fields with focus and preparation. Applying diversification strategy to game companies can effectively improve company performance, bringing the development of game companies from a quantitative change to a qualitative change.
1. The macro background of diversification strategy
Entering 2021, under the strong control of the epidemic by the state, people's lives have returned to normal, and economic culture has shown a great recovery trend. On April 30, 2021, according to the data released by the National Bureau of Statistics, the development of the national cultural industry has basically recovered to the level before the epidemic [1]. This is very favorable news for the gaming industry, which accounts for a large proportion of the cultural industry. Although the epidemic did not greatly impact the gaming industry, the inability to carry out offline activities has always affected game company performance. The recovery of the cultural industry means that the great development and prosperity of the cultural industry can promote and drive more game companies towards sustainable development [2]. 𝒻𝘳𝘦𝘦𝘸ℯ𝒷𝘯𝘰𝑣ℯ𝑙.𝘤𝑜𝘮
From last year's epidemic outbreak to the current stable epidemic situation, the state has promulgated relevant policies to support the development of the cultural industry from multiple aspects such as finance, systems, and finance. Although the epidemic hindered people's travel, it could not control the speed of online network dissemination. More and more new media emerged, driving the development of the cultural industry during epidemic prevention and control, but due to each company wanting to enter the online market, the competitive environment within the cultural industry is very fierce. Many traditional offline enterprises were eliminated by society due to the impact of the epidemic, but in these short two years, many successfully transformed cultural industries have emerged. Most of these enterprises relied on diversification strategy models to accelerate transformation and upgrades, also gaining significantly during the period of epidemic prevention and control when resident consumption levels increased significantly, obtaining more diversified development modes and revenue channels. For example, the transformation made by Sanqi Mutual Entertainment Company during epidemic prevention and control is worth learning for most game companies [3].
2. Brief analysis and classification of diversification strategy
(1) Brief analysis of diversification strategy
The diversification strategy was proposed by the father of strategic management, Igor Ansoff. In his book "What Is Corporate Strategy," he mentioned the classification of diversification strategies. This globally influential strategy model is involved in the management policies of multiple countries, so much so that every company, big or small, seeks a place according to the development model of diversification strategy today [4].
(2) Classification and meaning of diversification strategy
There are four types of diversification strategies: horizontal diversification, vertical integration, concentric diversification, and comprehensive diversification. The meanings of the four different models derived from diversification strategy are also different. 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 is where enterprises vertically derive based on their own development situation, using product industry chains to penetrate other market fields to seek new consumers. Concentric diversification focuses more on the innovation of existing technology, where new products are produced within the original production scope, and the entire process is achieved through the transformation of existing technology. Comprehensive diversification focuses more on expanding the changes in the scope of operations, where enterprises need to link factors related to their own products such as raw materials, technology, and the market to expand the scope of operations [5].
3. The impact of diversification strategy on game company performance
It can be said that in all game company operations, the impact of diversification strategy on game company performance is uniformly divided into two parts: the change of operation mode and the shift of strategic planning. From the changes in these two parts gradually taking effect, they drive the improvement of company performance. The impact brought by diversification strategy is multifaceted. This paper will analyze and study the impact of diversification strategy on game company performance using Sanqi Mutual Entertainment Game Company as an example [6].
(1) Change of operation mode
Currently, the main operation range of Sanqi Mutual Entertainment Game Company is quite extensive, which relies on the advantages brought by diversification strategy. The company's business is not only involved in the operation of interactive entertainment, but also single-handedly undertakes the research and distribution of mobile games and web games under Sanqi Mutual Entertainment Game Company. In recent years of development, it has continuously innovated alongside technology, expanding the market to layout film and anime in the 2D culture, and is shaping the market cultural industry chain belonging to Sanqi Mutual Entertainment Game Company in music, VR technology, and various live broadcast and other pan-entertainment businesses.
Sanqi Mutual Entertainment Game Company was established in 1995, but the development path in its early years was not smooth. The predecessor of Sanqi Mutual Entertainment Game Company was a small enterprise, and initially, the industry chain of Sanqi Mutual Entertainment Company did not involve the operation of games and other entertainment industries, always having the 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. Accompanied by poor post-operation and market contractions, Sanqi Mutual Entertainment eventually did not escape the fate of being acquired.
In 2014, Wuhu Shunrong Auto Parts Co., Ltd. acquired sixty percent of the shares of Shanghai Sanqi Mutual Entertainment Technology Co., Ltd. Although nominally acquired, this was a development opportunity worth grasping for Sanqi Mutual Entertainment. The two companies completed the asset restructuring of various industries through multi-party cooperation. It is worth mentioning that the strategy Sanqi Mutual Entertainment has always operated began to show its features at this time. Sanqi Mutual Entertainment Company transformed from a single modern cultural and creative company before the acquisition to a currently dual-main business listed company, concurrently operating advanced production manufacturing and modern cultural creativity. Correspondingly, the company operation strategy of Sanqi Mutual Entertainment also changes, with the initial scope of business covering cultural and creative industries.
