Types of Diversification Strategy

The video tutorial explains four types of diversification strategies: concentric, horizontal, vertical, and conglomerate. Concentric diversification involves adding new products closely related to existing ones, leveraging current operations and competencies. Horizontal diversification introduces somewhat unrelated products to the same customer base, relying on brand loyalty. Vertical diversification involves entering different stages of the value chain, such as distribution or raw materials, offering new value lines. Conglomerate diversification presents entirely unrelated products to new or existing markets without depending on brand recognition. These strategies help businesses expand and reach new customer bases.

Discuss the overall concept of diversification and its purpose in business strategy.

What is conglomerate diversification and how does it differ from other types?