It’s incredible to think that globalization and digitization have converged into what we now know as digital globalization. With global digitization growing at a lightning pace, then it’s no surprise that so many businesses are embracing a global strategy.
However, you might not have known that global strategy is a different business concept from international strategy. If you feel a little confused about the subject, don’t worry. In this quick guide, we’ll explain the differences in a simple manner.
Read on to get the lowdown on the differences between the two.
What Is International Business Strategy?
An international strategy is when companies try to mold their services or products to fit within different domestic markets around the world. So you can also refer to it as a multidomestic strategy.
We can focus on the idea of a fast-food chain that serves food in various countries. In one country, they may change the menu slightly to cater to the preferred tastes (like this famous example).
For example, in one country, the menu might have spicier options than in another where the business functions. So you can see international strategy as a concept where strategic managers try to adapt their business model to fit within different markets around the world.
What Is Global Business Strategy?
A global business strategy is one that is focused on planning for a global marketplace. You could say it is a strategy that’s less adaptive but more interested in creating new influence worldwide.
So in this instance, you can consider a business that sells wine. Let’s also say it’s based in Australia and wants to expand.
Now, if this company takes on a global business strategy, it will want to push its wine products all over the world in pretty much the same format as they sell at home. The only differences may be the languages printed on the bottles and other non-marketing-related things.
Which Is Best?
Neither is outright best, as they both have different approaches to global business. It all depends on what a company wants and the way it structures itself.
You can say that international strategy often lets domestic subsidiaries do a lot of the decision-making in their particular markets. Global strategy is more about one message and doesn’t allow much room for interference.
It could be the case that some companies adopt global and international strategies. They might have some products that are homogenous around the world, while others they might adapt for other markets. In the end, both are highly effective when done well.
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International vs. Global Strategy Explained
Now you should have a better grasp of the differences between international and global strategy. The one thing they have in common is their focus is on expansion into worldwide markets.
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