If there is a monster (technological and social change) stomping about crushing baskets underfoot, it’s best not to have all your eggs in one basket, no?
Best to get out of a fading industry while you still can, but if you jump too early, you miss profits, and may not land somewhere very safe. #tricky.
Diversification is a corporate strategy to enter into a new market or industry which the business is not currently in, whilst also creating a new product for that new market. This is most risky section of the Ansoff Matrix, as the business has no experience in the new market and does not know if the product is going to be successful.
Diversification is part of the four main growth strategies defined by Igor Ansoff’s Product/Market matrix:
Ansoff pointed out that a diversification strategy stands apart from the other three strategies. The first three strategies are usually pursued with the same technical, financial, and merchandising resources used for the original product line, whereas diversification usually requires a company to acquire new skills, new techniques and new facilities.