What is an example of unrelated diversification?

Unrelated Diversification Why would a soft-drink company buy a movie studio? This is a good example of unrelated diversification, which occurs when a firm enters an industry that lacks any important similarities with the firm’s existing industry or industries.

How has Apple used diversification?

Apple Inc. embraces diversification strategy as a means of promoting its viability in the market. Largely, the creation of the three products lines compounds the sources of the company’s income. In fact, the company does not rely on a single source of income because the product design belongs to different categories.

Is Disney related or unrelated diversification?

The Walt Disney Company (Disney) utilizes a related diversification strategy. The studio entertainment BU produced the film and soundtrack under Walt Disney Pictures and Walt Disney Animation Studios in 2013. Following its success, Frozen is also in being adapted for Broadway (Gamble & Turnipseed, 2014, p.

What is product unrelated diversification?

Unrelated diversification: When a firm enters an industry that lacks any important similarities with the firm’s existing industry or industries.

Which is an example of related and Unrelated Diversification?

Apple Inc S Related And Unrelated Diversification Unrelated Diversification is a form of diversification when the business adds new or unrelated product lines and penetrates new markets. For example, if the shoe producer enters the business of clothing manufacturing.

What do you mean by Unrelated Diversification Virgin Media?

If somebody was to ask what industry Virgin operates in primarily, the first thought that comes to mind would inevitably vary between each of us. This is due to the Virgin Group partaking in what’s known as ‘unrelated diversification’ – the fifth strategy in Ansoff’s Matrix.

What happens to your business when you diversify?

“There are actually two kinds of diversification: related and unrelated,” Shipilov said. “The latter involves businesses entering markets in which they have no related resources. However, the more that businesses move away from their core competencies, the greater the chance of problems emerging.”

How is diversification related to other business units?

Related diversification provides the potential to attain synergies by the exchanged or sharing of skills or resources. One business unit must have skills or resources that are ‘exportable’ to another company or business unit.