Diversification is defined as: "A growth strategy where a business markets new products in new markets."
But it is a risky strategy. The business is moving into a new area of a market in which it has little or no experience. Here we discuss how the video game industry did this.
Video games and how they diversify
2 companies that went into video games from electronics and appliances:
Sony - PS4
Microsoft - Xbox
Better brand image
Effectiveness in overall activities
Increase in profits
Better relations with distributors
Increase customer base
Efficiency and effectiveness in the organization
Brand awareness into new markets
Increase consumer standards
Distributors and Suppliers