International Marketing vs. International Business (the difference)

Better technology, increased communication and free trade have made international business and international marketing much easier in recent years. 

In fact, it has never been easier for businesses to market and trade goods and services across international borders

This raises the question of international marketing vs. international business. While the two concepts are very similar, they require very different activities. 

What's the difference between international marketing and international business?
International business is the set of administrative functions needed for doing business in foreign markets. International marketing supports the business to gain and keep customers.

Said another way, international marketing is actually conducting marketing activities across borders. While on the other hand, international business refers to an enterprise whose sole purpose is facilitating the sale of goods and services.

Let’s now review international business and international marketing and help you get started on a path to success.

International Marketing vs. International Business

The concept of international trade has been around for millenia.

It’s certainly not new. 

International trade is rooted in the concept of comparative advantage. This means that countries who are good at producing particular products or services should sell (export) to other countries that cannot produce the same product or service as efficiently. 

For example, Cook Islands and New Zealand are international trading partners. Cook Islands produces and sells black pearls to New Zealand because of their rich natural resources and efficiency in producing black pearls. On the other hand, New Zealand is far more efficient at producing autos than Cook Islands is and therefore sells autos to Cook Islands.

For a better understanding of comparative advantage and the idea of globalization, vist this helpful article:

What is Globalization in Simple Words? (+examples)

The main assumption is that not all nations produce all goods efficiently and will benefit from trading with one another.

Thanks to technology and better communication, international trade is easier than ever before.  

This means that you can set up your business to trade internationally across country borders and regional areas. This also means you can market your product and services to new horizons, lands, and marketplaces outside of your comfort zone.

But remember, there is a fine line between business and marketing because the two go hand-in-hand. 

Few businesses can exist without marketing, and marketing is done to boost business at domestic and international levels.

Simply put, international business and international marketing complement each other. International business involves the infrastructure for the exchange of goods and services between countries. International marketing involves promoting and customizing products to fit the local market in other countries.

Let’s now dig a little deeper.

What Is Meant by International Marketing?

Simply put, international marketing is conducting marketing activities across internationally recognized borders. It is the process of planning and implementing the promotion, conception, pricing, and distribution of services and goods across borders.

The best way to think about it is to keep it very simple. And position the act of international marketing as implementing the marketing mix in another country. 

If you aren't familiar with the marketing mix, you need to be, it is a core function of all marketing professionals. 

Go here to learn more about the marketing mix:

What is the marketing mix and why is it important? | The 4 P’s of marketing

International marketing aims to satisfy international consumers' needs while meeting organizational and individual objectives.

4 types of international marketing include:

1. Exports and Exports

In international marketing, companies allow other companies to facilitate the sales and purchases of goods abroad in their name. The companies tasked with marketing will establish a local branch in the intended country to facilitate the sales and purchases on behalf of the other company. The marketing company can also send sales agents and distributors abroad to work on behalf of the company.

2. Global Internet Strategies

This involves raising awareness about your goods or services in other countries using electronic media. A good example is the use of a company website where potential clients can get detailed information about the product from anywhere in the world. Note that the information must be published in different languages spoken across the target market.

3. Franchising and Licensing

This is a method of international marketing where a local company allows a foreign company to use its name, trademarks, and patents to facilitate sales in the targeted foreign country. The domestic company reaps many benefits because someone is doing the marketing on their behalf but in a regulated manner.

Licensing is a bit different because the domestic company has less control over what the foreign company does with the license.

For an excellent article on many of the best marketing and advertising franchises, go here: 

Best Advertising and Marketing Franchise Opportunities (22 reviews)

4. Joint Ventures

In joint ventures, both companies contribute equally to the marketing effort. A foreign company may look for a local company and form a partnership to make its foreign goods acceptable locally.

Perfect examples of such partnerships include TATA Sky and TATA AIG.

What Is Meant by International Business?

A “business” is an enterprise whose sole purpose is facilitating the sale of goods and services. Adding the word international means the business conducts its operations beyond the borders of its parent country. 

For example, most countries allow foreigners to start a business. Typically, this means they can file the administrative and legal paperwork needed to be recognized as a business entity in a foreign country.

This means the business entity will pay any relevant sales taxes, fees, municipal taxes, income taxes or taxes on profits as necessary.

This also means that the foreign business can do business in this territory and gain customers.  

Here are two excellent resources for more information about setting up a legal entity, and in doing business in another country:

  1. What is the point of having an LLC? (+pros and cons)
  2. 9 reasons why Costa Rica is good for business (+trusted resources)

International businesses also deal with the transfer of international resources, including intellectual property, contractual liabilities or assets, and the exchange of human resources. Examples of intellectual property include patents, data, brand trademarks, and copyrights. Contractual assets and liabilities include rights to serve foreign customers or use a foreign asset.

International businesses vary in size. Some are large multinational companies with many employees operating in different countries, and others are small one-person importer/exporter companies. Further, international business can also include companies operating across borders for non-profit gains like political favors and corporate social responsibility.

Types of international businesses include large multinational corporations, exporters/importers, and service companies.

International Marketing Examples

Here are some high level, very well known examples of international businesses and briefly how they approach international marketing. These include:

  • Nike Inc – Deals with the development and manufacturing of sports equipment, apparel, and footwear
  • Spotify - Music and podcast
  • Airbnb - Deals with vacation rentals, beach houses, and cabins
  • Red Bull GmbH – Sells energy drinks

The listed companies appear under international marketing due to their unique ways of selling themselves online. 

Nike, for instance, allows consumers to customize products to their own tastes, thus appealing to millions of clients worldwide. 

Red Bull effectively employs the global web strategy since its website is in many international languages. They also host events and games like the Grand Prix in different countries to promote their brand locally.

International Business Examples

Apple

Apple is a well-known international business that deals with the sale of computers, mobile phones, and smart gadgets. They have a huge international presence with 521 retail stores in 25 different countries worldwide.

Coca Cola Company

This is another international business that deals with producing and selling soft drinks worldwide. You will find their drinks on store shelves across 200 different countries globally. The company also produces bottled water in citrus beverages.

Dell Computer Corporation

The American company operates worldwide, selling computers and other technology solutions. It is among the largest supplier of personal computers in the world. Additionally, consumers in approximately 180 countries enjoy Dell-branded computer-related products.

Starbucks Corporation

It is no secret that you will likely find a Starbucks coffee house in most places globally. The American coffee company had a presence in over 80 countries by the end of 2021. And the most surprising thing is all they do is sell coffee.

Conclusion: International Marketing vs. International Business

International marketing is the process of conceiving, planning, and executing the promotion, sale, and purchase of goods and services outside the country’s borders. International businesses are enterprises that facilitate the exchange of goods and services across the country’s borders.

The demarcation line between the two is pretty vague because international businesses sometimes employ international marketing strategies, while international marketing may involve international businesses. The main point to note is that international businesses sell their products as they are, without any alterations, to local and international clients.

On the other hand, international marketing involves customizing the brand and products to satisfy the needs of international consumers.

References

  1. International Marketing: https://books.google.com/books?hl=en&lr=&id=kSYXAAAAQBAJ&oi
  2. 5 International Business Examples to Learn From: https://online.hbs.edu/blog/post/international-business-examples
  3. International Marketing: Explore the Strategy of International Marketing: https://www.marketing-schools.org/types-of-marketing/international-marketing/
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