A multi-domestic strategy is a strategy by which companies try to achieve maximum local responsiveness by customizing both their product offering and marketing strategy to match different national conditions. Production, marketing and R&D activities tend to be established in each major national market where business is done.
An alternate use of the term describes the organization of multi-national firms. International or multinational companies gain economies of scale through shared overhead and market similar products in multiple countries. Multi-domestic companies have separate headquarters in different countries, thereby attaining more localized management but at the higher cost of forgoing the economies of scale from cost sharing and centralization.