Ecommerce advertisers spend a lot of money creating and running campaigns designed to help them sell more. We use stories, fast facts and marketing tactics to put our content in front of our target audience, hoping it connected with them in some way.
Though the lines between these two factions can be blurred, it’s important to understand whether your specific campaigns are focused on product advertising or institutional advertising. If you aren’t sure, your campaigns will become muddled and you won’t get the results you want.
In this post, we’ll help you sort out the differences between the two, along with best practices for each and some tips on when to use them.
Advertising plays a crucial role in promoting a company’s brand products or services. However, not all advertising serves the same purpose. There are two main types of advertising – institutional advertising and product advertising. Both have different objectives and help organizations in distinct ways. In this article, we will take a closer look at institutional and product advertising, their key differences, advantages and disadvantages.
What is Institutional Advertising?
Institutional advertising aims to build a company’s reputation and image among its target audience. It does not focus on selling a specific product or service. The goal is to establish brand awareness and shape consumer perceptions about the values, vision and identity of a company.
Some common objectives of institutional advertising include:
- Creating goodwill about the organization in the marketplace
- Building trust and credibility
- Highlighting social contributions and community initiatives
- Promoting causes and issues the brand supports
- Communicating core values and philosophy
- Sharing company history and achievements
- Introducing leadership and team members
- Recognizing employee accomplishments
As it focuses on the organization as a whole, institutional advertising tends to use an emotional appeal. The tone is positive and uplifting. The ads highlight admirable company traits like integrity transparency, innovation environmentalism, inclusivity and philanthropy. This helps strengthen affinity and connection with the target audience.
Examples of institutional advertising include feel-good “image ads” about values, corporate mission statements, executive profiles, CSR reports, diversity commitments, anniversary celebrations, commemorating milestones, launching community programs, promoting workplace culture and employer branding
What is Product Advertising?
Product advertising specifically promotes goods and services sold by a company. The goal is to generate interest, entice trial usage and directly impact sales. Product ads provide details about features, pricing, availability, comparisons with competitors and reasons to purchase.
Common objectives of product advertising are:
- Increasing brand awareness for a particular product/service
- Educating consumers about new products/services
- Highlighting key features and benefits
- Promoting special deals, discounts or sales
- Driving website traffic, footfalls, inquiries
- Generating leads and converting prospects
- Boosting sales revenue and market share
As product advertising aims for a direct commercial response, the messaging uses a rational approach focused on the offering, its utility and value proposition. The tone tends to be factual, precise and leverages stats or data. These ads appear across media like TV, radio, print, billboards, online platforms and social media.
Examples include new product launch campaigns, promotional pricing, seasonal sales, limited-time offers, free shipping deals, trial periods, informative infomercials, comparison charts, customer testimonials, money-back guarantees, limited editions and more.
Key Differences Between Institutional and Product Advertising
While both institutional and product advertising aim to benefit the company, there are some notable differences between the two:
Objectives
- Institutional advertising: Build brand image, goodwill and affinity
- Product advertising: Generate leads and sales for specific products
Focus
- Institutional advertising: Company as a whole
- Product advertising: Specific products or service offerings
Appeal
- Institutional advertising: Emotional, value-based
- Product advertising: Rational, functional
Timeframe
- Institutional advertising: Long-term brand building
- Product advertising: Short-term conversion goals
Metrics
- Institutional advertising: Brand awareness, reputation, sentiment
- Product advertising: Sales, leads, traffic, conversion rate
Creativity
- Institutional advertising: Brand storytelling
- Product advertising: Product features and benefits
Target Audience
- Institutional advertising: Broad audience
- Product advertising: Potential customers
Media Mix
- Institutional advertising: PR, community engagement, ambient
- Product advertising: Sales funnels, performance marketing
Pros of Institutional Advertising
- Cultivates brand affinity and loyalty
- Differentiates from competitors
- Improves recruitment and retention
- Boosts credibility and trustworthiness
- Reinforces core values and purpose
- Deepens customer relationships
- Positively shapes public perception
- Protects reputation during crises
- Provides a foundation for product ads
Cons of Institutional Advertising
- Difficult to quantify impact and ROI
- Higher budgets required for consistent messaging
- Takes longer to see results
- Risk of seeming self-congratulatory
- Appears disconnected from products
- Too emotionally focused for some audiences
- Customers may perceive it as indulgent
Pros of Product Advertising
- Directly promotes goods and services
- Easier to quantify results and calculate ROI
- Drives website traffic and conversions
- Generates new leads and sales
- Helps launch or boost awareness of new products
- Links brand to specific consumer benefits
- Adaptable messaging for campaigns and promotions
- Lower risk approach aligned to commercial goals
Cons of Product Advertising
- Seen as aggressive sales pitches
- Focuses solely on products versus brand values
- Too transactional for nurturing customer relationships
- Heavy discounting and promotional deals may devalue brand
- Cluttered space competing for consumer attention
- Short-term approach less suited for brand building
- Not differentiated from competitor product ads
- Resource intensive to keep messaging fresh and creative
Best Practices for Impactful Advertising
- Ensure alignment between institutional and product advertising for a unified brand voice and positioning.
- Balance emotional appeal with rational messaging to connect with audiences and motivate purchase.
- Tailor advertising strategy to campaign objectives, whether driving long-term affinity or short-term conversions.
- Invest in market research to identify motivators and messaging that will best resonate with target consumers.
- Maintain advertising consistency across platforms and touchpoints based on the buyer journey.
- Set measurable KPIs to track performance for both institutional and product advertising.
- Optimize campaigns in real-time based on data insights and metrics.
- Take an integrated marketing approach spanning PR, digital content, events, communities and influencer engagement.
- Leverage both traditional and digital media to achieve broad reach with targeted impact.
The Takeaway
Institutional and product advertising both play an invaluable role in a company’s marketing strategy. While institutional advertising cements brand perception and sentiment, product advertising directly impacts consumer choice and purchase.
Brands that find the right synergy between building affinity and driving conversions are best positioned for sustainable success. The ideal balance stems from truly understanding target audience motivations and crafting responsive advertising suited to long-term relationships as well as short-term sales.
Which Should I Use?
Most businesses need a combination of both product advertisements and institutional advertisements.
Both campaigns will complement the other: product advertisements can reinforce brand and institutional advertisements lay an essential foundation of trust that will help your product ads be more effective. You need both.
Many often use platforms like Facebook Ads to promote their institutional ads, helping new users discover the brand and get an idea what it’s about. Then, they’ll use either retargeting through Facebook Ads or search ads with AdWords to drive product interest and sales in interested users.
I have a strategy that I use with about 80% of my clients. I have institutional ad campaigns running constantly, updating them when the engagement, clicks, or frequency on Facebook Ads drops. These are most frequently designed to attract new customers and introduce them to the brand.
I also create new product advertisements at least every other month, which offer specific selling points of different products and address specific pain points.
These can be used for AdWords or be run with Facebook Ads targeting users who have recently engaged with the brand awareness campaign or users who have visited the site recently.
Product Advertisements vs Institutional Advertisements: What’s the Difference?
Product advertising focuses on promoting specific individual products, while institutional advertising focuses on promoting your overall brand.
This may sound like there could be some overlap, and there inevitably is to an extent, but the underlying objective of each is different, and that’s important. Product advertisements are trying to sell specific products immediately. Institutional advertisements are all about brand recognition and brand reputation. The latter is a more long-term approach to getting sales or leads, but it’s no less important.
Let’s look at an example. Pandora is a jewelry brand that sells charm bracelets that are made for women.
This ad from Pandora is an institutional ad, designed to introduce the brand to new customers or remind past customers about them. They’re going for romance in their ad, building a connection through an emotional memory so that users will hopefully remember them.
And then, for a good example of a specific product ad, check out the below. It’s highlighting a specific product collection—their Pandora Shine collection. Its big feature is the 18k gold-plated jewelry, which is all inspired by nature. These are specific benefits and facts about a specific product line, designed to increase sales on these particular items.
The difference between these two campaigns is striking. One is all about building brand awareness and hopefully driving traffic to the site, where users may browse to see if they find something. The second is about getting sales on a specific product line…and hopefully quickly. They go hand-in-hand together alongside each other, but they’re each serving distinct purposes.
Institutional vs Personality Advertising
What is the difference between institutional advertising and product advertising?
The primary difference between these types of advertising is that organizations use institutional advertising when marketing multiple products at the same time and product advertising when focusing on a single product.
What are the benefits of institutional advertising?
Institutional advertising may provide many benefits when advertising a new product or multiple products similar to previous ones your organization already offers. Consumers may already associate your brand with the type of product and consider it first when researching their options.
What is an example of institutional advertising?
In institutional advertising, this image extends to an organization’s entire product line, as it is a component of the brand, not a particular product. For example, a car company may create advertisements that associate its brand with the concepts of confidence and charisma.
How do brands use institutional and product advertising?
Let’s look at a couple of examples and see how some brands utilize institutional and product advertising. Image advertising is devoted to promoting the organizations’ overall image. It aims to create goodwill, a position for a company, and generate resources.
