Think of iconic brands like Apple, Nike, or McDonald's. What's the first thing that comes to mind? More often than not, it's their logos. A logo, as I like to put it is the face of the company, and it holds immense value. It’s a symbol that can evoke emotions, trust, and recognition. The question then arises, "How much should one pay for a logo?" As you may have guessed, an honest answer is that it depends. There are many variable that will influence how much one pays for a logo so to save you some time, I developed a napkin math formula to give you a tangible answer for a reasonable budget for a logo. My only caveat is that i'm assuming that you're working with a qualified expert.
Every time a client asks me, "how much do you charge for a logo?" I pause because the answer isn't a fixed number. It depends. "How big is your company? What's your total gross revenue? Where does your logo live? Are you rebranding, or starting from scratch? How much is it going to cost you to implement the new logo? What's your advertising budget?". These questions are designed to better understand the size of the problem we are trying to solve for. The bigger you are the bigger the impact your logo has, because there is more exposure and therefore risk associated with it.
There are companies the pay 1 million dollars for a logo, and companies that pay less than 100 dollars for a logo. Nike famously paid $35 for its "swoosh" logo but after the success of the company they gave shares in the company along with a gold ring to designer Carolyn Davidson. As mentioned, the gap is caused by a variety of factors so to simplify it for you, I came up with 1% of gross revenue as a great rule of thumb.
Every entrepreneur knows that startups thrive on perception as much as reality, especially in the early stages. If a well-designed logo can augment the startup's credibility, it could be instrumental in wooing investors or securing that first big client.
I always recommend getting proof of concept first before investing heavily into developing your brand and logo although I can understand how a startup, looking to raise hundreds of thousands of dollars, if not more, would be willing to invest into a professional logo.
Changing the brand's face isn't just about the logo design. It's about updating brand guidelines, marketing materials, packaging, and more. Rebranding can sometimes cost even more than the initial logo design.
A corporate behemoth would have its logo stamped across multiple channels – think office signage, fleet livery, merchandise, digital platforms, print materials, and more. Transitioning to a new logo implies updating all these assets. For instance, a simple task like reprinting stationery or rewrapping a fleet of vehicles with the new logo can run into hundreds of thousands of dollars, if not more.
The greater the investment in changing the logo, the higher the stakes are. An erroneous decision here could cost millions, not just in tangible assets but also in terms of brand equity and customer loyalty.
Investing more in your logo design can significantly reduce the risk of "getting the logo wrong." A higher investment typically involves in-depth market research, multiple design iterations, and expert input, ensuring the final product resonates with the brand's identity and appeals to its audience. For startups, this can be pivotal in setting the right first impression. For giants, it's about preserving and enhancing established brand equity.
In essence, while the actual cost of designing the logo is a factor, the cascading costs and implications of implementing it (or changing it) often play an even more significant role in the decision-making process.
When contemplating the worth of your logo, introspect on the following:
Is this logo for a venture that's your bread and butter? If it's pivotal in representing your brand's value proposition and generating revenue, consider the long-term ROI.
If the logo is for a personal endeavor, a side-hustle, or just for fun, your budget might be more constrained. Gauge your personal attachment and the project's scale to determine a fitting budget.
It sounds straightforward, but it's worth emphasizing. Always factor in your current financial situation. A great logo is valuable, but ensuring your business's financial health should always be the priority. Spreading the payment monthly can also be a viable option to maintain financial fluidity.
A logo is more than just a design; it's the face of your brand, the symbol customers associate with your products or services. Its value is intertwined with its potential to drive brand recognition and loyalty. While the 1% rule provides a useful benchmark, the real value of a logo lies in its alignment with your business goals and aspirations. Whether you're a giant corporation or a small startup, your logo should reflect your ambition, ethos, and the narrative you want to convey to the world.