(To be released later.) Abstract: With the progress of technology and the model of intelligent network coverage, the rise of the ga industry in recent years is evident to all citizens. The way gas are disseminated is no longer confined to rigid promotional models, and their influence has gradually expanded to all aspects of life. Correspondingly, ga companies also need to continuously integrate resources, innovate, and update to improve performance in line with the rapid developnt of the tis. A diversification strategy perfectly ets the planning needs and developnt goals within the gaming industry. Against the backdrop of economic globalization, diversification strategy, as the preferred mode of corporate developnt, is also applicable to gaming companies. This article uses Sanqi Mutual Entertainnt Company as an example to explain the impact of diversification strategy on the performance of ga companies.
Keywords: diversification strategy; ga company; performance; impact; Sanqi Mutual Entertainnt
A diversification strategy is a market strategy employed by enterprises during operations to occupy and expand new markets, as well as to avoid risks encountered in running a single business. It involves a strategic plan to purposefully and preparedly enter new business fields. Applying diversification strategy to gaming companies can effectively enhance company performance, bringing about a transformation from quantitative to qualitative change in the company’s developnt.
1. The Macro Background of Diversification Strategy
Entering 2021, with the effective control of the pandemic by the country, people’s lives have returned to normal, and the economic and cultural landscape shows a promising recovery trend. On April 30, 2021, relevant data released by the National Bureau of Statistics showed that the developnt of the national cultural industry had basically returned to the pre-pandemic level[1]. For the ga industry, which occupies a significant portion of the cultural industry, this is very favorable news. Although the arrival of the pandemic did not greatly impact the ga industry, the inability to conduct offline activities always affected ga companies’ performance. With the warming of the cultural industry, for most ga companies, this ans that the great developnt and prosperity of the cultural industry can promote and drive more ga companies onto a path of sustainable developnt[2].
From the outbreak of the pandemic last year to the current stabilization, the country has promulgated relevant policies from multiple aspects such as finance, system, and finance to support the developnt of the cultural industry. Although the pandemic has halted people’s travel, it cannot control the spread speed of online networks. More and more new dia have erged, driving the developnt of the cultural industry during the pandemic prevention period. However, since each company wants to enter the online market, the competitive environnt within the cultural industry has beco very intense. Many traditional offline companies have been eliminated by society due to the pandemic’s impact, but in just two short years, many successfully transford cultural industries have erged. Most of these companies have accelerated their transformation and upgrading relying on diversification strategy modes, reaping substantial rewards during the pandemic prevention period when residents’ consumption levels have significantly increased, gaining more diversified developnt models and capital inco channels. For example, the transformation made by Sanqi Mutual Entertainnt during the pandemic prevention period is worth emulating by most ga 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 managent, Igor Ansoff. In his book "What is Corporate Strategy," he ntioned the classification of diversification strategy. This world-influencing strategic model has been involved in managent policies of multiple countries, so today every business, big or small, seeks a place according to the developnt model of diversification strategy[4].
(2) Classification of Diversification Strategy and Its aning
Diversification strategy is divided into four types: horizontal diversification, vertical integration, concentric diversification, and overall diversification. The four different modes derived from the diversification strategy also have various anings. Horizontal diversification refers to the company utilizing the original conditions provided by the market to produce new products that can et new user demands, thereby driving market consumption. Vertical integration is when a company, based on its developnt situation, vertically derives and uses the product industry chain to penetrate other market fields to seek new consurs. Concentric diversification focuses more on the innovation of existing technology, requiring the production of new products within the original production scope. The entire process is realized through the tamorphosis of existing technology. Overall diversification focuses more on expanding the scope of operations. Enterprises need to associate factors related to their product’s raw materials, technology, and market to expand the scope of operations[5].
3. The Impact of Diversification Strategy on Ga Company Performance
It can be said that in the operation process of all ga companies, the impact of diversification strategy on ga company performance is divided into two parts: changes in the operation mode and shifts in strategic planning. The effects gradually generated from these two parts drive the improvent of company performance. The impact of diversification strategy is multifaceted, and this paper will take Sanqi Mutual Entertainnt Ga Company as an example to analyze and research the impact of diversification strategy on the performance of ga companies[6].
(1) Changes in Operation Mode
Currently, the primary operation scope of Sanqi Mutual Entertainnt Ga Company is very broad, which is also an advantage brought by the diversification strategy. The company’s business not only involves interactive entertainnt operations, but it also undertakes the research and publication of mobile and web gas under Sanqi Mutual Entertainnt Ga Company. Moreover, in the developnt of recent years, it has continuously innovated in line with contemporary technology, expanding the market to include film and ani, and it is shaping the market cultural industry chain belonging to Sanqi Mutual Entertainnt Ga Company in music, VR technology, and various live streaming pan-entertainnt businesses.
In 1995, Sanqi Mutual Entertainnt Ga Company was established. However, the initial developnt path was not smooth. The predecessor of Sanqi Mutual Entertainnt Ga Company was a small-scale enterprise, and the industrial chain of Sanqi Mutual Entertainnt did not initially involve the operation of gas and other entertainnt industries, with the risk of being annexed by the market at any ti. However, relying on the steady developnt of a single industry, Sanqi Mutual Entertainnt Company was listed in 2011. But with poor operations afterward and market contraction, Sanqi Mutual Entertainnt ultimately did not escape being acquired.
In 2014, Wuhu Shunrong Auto Parts Co., Ltd. acquired 60% equity of Shanghai Sanqi Mutual Entertainnt Technology Co., Ltd. Although nominally acquired, for Sanqi Mutual Entertainnt, this was a developnt opportunity worth seizing. The two companies completed restructuring of various industrial assets through multi-party coordination. Notably, the strategy that Sanqi Mutual Entertainnt has always operated began showing its initial power at this ti. Sanqi Mutual Entertainnt Company transford from a single modern cultural and creative company before being acquired to the current dual main listed company with advanced production manufacturing and modern cultural creativity running parallel. Correspondingly, the company’s operational strategy of Sanqi Mutual Entertainnt has also changed, along with the scope of business originally covered by the cultural and creative industry. In 2014, Wuhu Shunrong Auto Parts Co., Ltd’s cultural and creative industry originally covered the business scope.
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