This Lord is Very Scientific-Chapter 814 - 746

(Anti-theft, to 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 become evident to the public. The dissemination methods of games are no longer confined to rigid propaganda models, and the influence of games has gradually expanded to all aspects of life. Correspondingly, gaming companies also need to integrate resources continuously, innovate and iterate, and improve performance in line with the rapid development of the times. A diversification strategy meets the planning needs and development goals within the gaming industry. In the context of economic globalization, a diversification strategy as the preferred mode for corporate development is also applicable to gaming companies. This article uses Sanqi Mutual Entertainment Company as an example to explain the impact of diversification strategy on the performance of gaming companies.

Keywords: Diversification strategy; Gaming company; Performance; Impact; Sanqi Mutual Entertainment Company

A diversification strategy is a market strategy tool adopted by enterprises to capture more new markets and develop new markets, and is a strategic plan used to avoid risks encountered in operating a single business by entering new areas of business with focus and preparation. Applying a diversification strategy to gaming companies can effectively improve company performance, bringing about a process of quantitative to qualitative change in the development of gaming companies.

1. Macro Background of Diversification Strategy

Entering 2021, under the country's effective control of the pandemic, people's lives have returned to normal, and the economy and culture are showing a great trend of recovery. On April 30, 2021, according to the relevant data published by the National Bureau of Statistics, the development of the national cultural industry has basically returned to the pre-pandemic level[1]. This is very favorable news for the gaming industry, which accounts for a large proportion of the cultural industry. Although the pandemic's arrival did not significantly affect the gaming industry, the inability to conduct offline activities continually impacted the performance of gaming companies. The warming of the cultural industry means that for most gaming companies, the great development and prosperity of the cultural industry can promote more gaming companies to embark on the path of continuous development[2].

From last year's outbreak to the current stabilization of the pandemic, the country has issued relevant policies from various aspects such as finance, regulations, and finance to support the development of the cultural industry. Although the pandemic halted people's travel, it could not control the speed of dissemination over online networks. More and more new media have emerged, driving the development of the cultural industry during the pandemic prevention and control period. However, as each company wants to enter the online market, the competitive environment within the cultural industry is very intense. Many traditional offline enterprises could not withstand the impact of the pandemic and were eliminated by society during this time, but in these short two years, many cultural industries that successfully transitioned have also emerged. These enterprises largely relied on diversification strategy models to accelerate transformation and upgrading. During the pandemic prevention period when residents' consumption levels increased significantly, they also gained substantial rewards and obtained more diversified development modes and sources of revenue. For example, the transformation made by Sanqi Mutual Entertainment during the pandemic prevention period is worth most gaming companies referencing[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. In his book "Corporate Strategy," he mentioned the classification of diversification strategies. This world-influencing strategy model is involved in the management guiding policies of many countries, leading to a point where every large and small enterprise today is seeking a place according to the development model of diversification strategy[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 four different modes derived from the diversification strategy also have distinct meanings. 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 means enterprises derive vertically based on their own development situation, using the product industry chain to penetrate other market fields to seek new consumers; concentric diversification focuses more on innovation of existing technology, requiring the production of new products within the existing production range, the whole process is realized through the transformation of existing technology; conglomerate diversification focuses more on expanding the operational range and requires companies to connect related raw materials, technology, and market factors with their products to expand their operational domain[5].

3. Impact of Diversification Strategy on Gaming Companies' Performance

It can be said that during the operation process of all gaming companies, the impact of diversification strategy on gaming companies' performance is uniformly divided into the transformation of operational models and the transfer of strategic planning. The effects gradually produce performance improvement for companies from these two aspects of change. The influence brought by diversification strategy is multifaceted. This paper will take Sanqi Mutual Entertainment Game Company as an example to study and analyze the impact of diversification strategy on gaming companies' performance[6].

(1) Transformation of Operational Models

Currently, the main operational scope of Sanqi Mutual Entertainment Game Company is very broad, which is thanks to the advantages brought by the diversification strategy. The company's business not only involves the operation of interactive entertainment but also fully encompasses the research and distribution of mobile games and web games under Sanqi Mutual Entertainment Game Company. Moreover, in recent development, they have been keeping pace with contemporary technology and continuously innovating, expanding the market layout to cover film and animation, and even shaping Sanqi Mutual Entertainment Game Company's market cultural industry chain in the fields of music, VR technology, and various live entertainment businesses.

Founded in 1995, Sanqi Mutual Entertainment Game Company did not have a smooth development path initially. The predecessor of Sanqi Mutual Entertainment Game Company was a small enterprise where the industry's chain did not involve the operation of games and other entertainment industries. There was always a risk of being swallowed by the market, but relying on the steady development of a single industry, Sanqi Mutual Entertainment Company was listed in 2011. However, with the unsatisfactory operation and market contraction in later stages, Sanqi Mutual Entertainment ultimately 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% stake. Although it was an acquisition in name, for Sanqi Mutual Entertainment, this was an opportunity worth grasping. The two companies completed various industrial asset restructurings through multi-party cooperation. It is worth mentioning that the strategic exhibition that Sanqi Mutual Entertainment had been operating had already begun to show its edge at this time. Sanqi Mutual Entertainment Company transformed from a single modern cultural creative company before the acquisition to today's dual-core listed company of advanced production manufacturing and modern cultural creativity running parallel. Correspondingly, Sanqi Mutual Entertainment's corporate operational strategy also underwent changes, with the initially covered business scope of the cultural creative industry. In 2014, the range of business covered by Wuhu Shunrong Auto Parts Co., Ltd.'s cultural creative industry leading to Sanqi Mutual Entertainment's dual-core business pattern.