Institutional Promotion Details

Companies use institutional promotion as a form of advertising that creates a positive image that boosts brand recognition and generates public appeal. An organization taps into its goodwill, ethics, values, and stances on social responsibility as strategies for winning over customers with an institutional promotion.

Also known as corporate advertising or brand building, the focus of institutional promotion is usually the company, not its products. Since products and services change, institutional promotion guarantees that the brand name is strong enough to support everything sold under its umbrella.

As a form of corporate advertisement, institutional promotion is an approach that can change public attitudes towards a company and improve future product sales. Other functions of institutional promotion are:

  • To change attitudes towards a company, especially if it is facing public scandals.
  • To inform customers of a company's stance on meaningful social or environmental issues.
  • To update stakeholders on the company's plans.
  • To boost company morale, particularly when looking to hire new employees.
  • If a firm is less known, institutional promotion can also popularize the company name and type of business.

Real-World Example of an Institutional Promotion

If you look at most advertisements, you can see traces of big and small corporations using institutional promotion to boost their brand image. A company that has perfected institutional promotion is Nike, the shoe and apparel giant that never shies away from social issues of public interest.

In 2019, Nike made headlines with its "Colin Kaepernick" campaign that drew attention to the plights of Black people in the United States. The campaign's slogan, "Believe in something. Even if it means sacrificing everything," celebrated Kaepernick as an NFL player that protested police brutality.

While the campaign was considered controversial as audiences were divided between those supporting Nike and those boycotting its stores, it was a great success. Shortly after the campaign, Nike stock rose to a record high, revealing that "Just Do[ing] It" can pay off. Other than benefitting from the positive outcomes, Nike stood out as a socially responsible company.

Other companies that have benefitted from the institutional promotion are Coca-Cola, Google, and Wells Fargo that support charity events.

Types of Institutional Promotion

There are three kinds of institutional promotions that include public service, public relations, and patronage.

  • Public Service Promotion: Public service promotion refers to efforts that focus on noncontroversial issues in the public interest. Companies use this approach to depict themselves as responsible members of society who are keen on positive social change. Some examples include drug prevention campaigns and programs for the youth. Companies sponsor such campaigns to build reputations.
  • Public Relations (PR) Promotion: Public relations promotions address public interest issues but focus on those related to the company or its products. PR promotions can be either proactive (pure advertising) or reactive (responses to external conditions such as controversies or legal action). The purpose of PR promotions is to build a positive image that dominates over a damaging one.
  • Patronage Promotion: Patronage promotion boosts a company's prestigious image or popularizes new product features. Successful companies use prestige promotion to build on their existing image to differentiate themselves from the competition. Additionally, when companies add more features to their current portfolio, prestige promotion helps them sell new offers to loyal customers.

Institutional promotion is essential since once customers trust a brand, they become brand ambassadors loyal to its products and services.