How much should a startup invest in their logo design in 2021?
One thing that the start of the New Year always brings is people wanting to enroll into some kind of fitness boot-camp to get into better shape. Then there is a second group of people wanting to start out new ventures / side-hustles — that’s when they come to me.
Last week I was approached by two collogues of mine who I have worked with in the creative advertising industry here in Toronto. Both of them are starting their own side-hustle, and are looking to me (the branding design consultant) to help them with their logo design. So that got me thinking: how much should a startup invest in their logo design. How important is their logo with regards to their overall brand? How else can I help them in their business outside of just a logo design?
You see, when entrepreneurs come asking me, “how much for a logo design?” — it’s like asking an architect, “how much does it cost to build a house?”. A logo can cost as little as $5 or upwards of $1M+ through a full-blown branding and marketing agency.
It really depends on what their current situation is — including items as simple as the amount of money they have in the bank to dedicate to a logo, to how far along and developed their brand and voice is. Let’s look at two scenarios that are most likely to apply to the circumstances of a startup entrepreneur in 2021:
The Bootstrapped Startup Entrepreneur
At this point in their venture, they’re clearly scraping by with little money to spare — so the thought of spending thousands on a logo isn’t exactly reality. They’ve either taken out a small business loan from their bank, or launched a Kickstarter campaign to gather money from family and friends. So there are a number of options for having a relatively large number of logos produced for a fractional cost — which can be for as little as $5 at fiverr.com to a few hundred with 99Designs
The problem with using the above options is that you get a logo, but you have no clarity on how that would fit in with your overall brand. And NO, your logo is NOT your brand. It is just a small piece of your overall brand. Observe the chart below, to see where your logo fits in the overall scheme of your entire brand:
I know. It’s overwhelming isn’t’ it? But that’s what a professional branding consultant has to keep in mind when designing a logo for a startup business. We’ve been doing this for a while, so we know that designing a logo is never just designing a logo. There is a lot more work involved before we get into designing the logo (we call this “The Strategy” Phase). To kick off the Strategy Phase, we conduct a Discovery Session where we ask a series of question to learn more about our client’s business.
The questions we ask are as follows:
Tell us about your business?
Tell us more about the products or services you offer?
What can you tell us about your customers? What type of people are they?
What would you say your main message would be to your customers?
Why would your customers come to you instead of your competitors?
Who are your main competitors, and what do you know about them?
What is the biggest challenge for you in your industry?
What is the biggest challenge for your customers in your industry?
What is the biggest challenge for you in your business?
Where would you like to see your business in 5 years time? (the most important question).
I know what you’re thinking - these are not the kind of questions you'd expect a design consultant to ask when designing one's logo? Rather than just asking what's your favorite color, or what is your favorite kind of logos (in which case, most people will refer to the Apple logo or the Nike swoosh - without really understanding why they like it) .. these questions are more broader, and not only help us design your logo, but it also helps us design your unique brand for long-term success.
So let's get back to the question at hand ... How Much Money is it going to cost for a logo design from a professional branding consultant?
To answer this question, I will share a research survey that was compiled by the Registered Graphic Designers (RGD) Association here in Canada back in 2008, after surveying various design firms in Toronto for providing such design services:
So this gives you an idea, that back in 2008 — a logo design (stand-alone corporate identity design) had an average Market Value of CAD $5,630 (HST included). This price is for a company with annual revenues below $1 million. Services include research and design of primary logo identity; presentation of 2 to 3 concepts, including mockups to show how the logo, color palette, and typography would manifest itself in the form of stationery set (business cards, letterhead, envelopes).
But then, this model of pricing becomes like choosing from a Chinese menu — the entrepreneur wants to see how their brand would manifest as a website design, a package design, a brochure design … pretty soon all those costs start adding up.
We don’t approve of the Chinese menu concept of charging for our services. Instead we realize that every startup client’s business faces unique challenges. We take the time to understand their custom needs and then provide them with a custom approach and price specifically tailored to help their business. We also don’t bill by the hour. We have found that it is better, for both our clients and us, to create a detailed project scope and a fixed price. They will know exactly what services and deliverables we will provide and how much they will invest in the project. No surprises.
I always tell entrepreneurs, when starting a new business that a realistic budget must be set for branding and marketing — without which the company will be essentially invisible in a sea of stronger competitors. A logo should be designed to draw attention to it and to be memorable. With time the logo can become synonymous with the company in the customer’s mind. The logo will dictate the overall look of the company’s printed materials and website which must be skillfully designed to retain brand harmony throughout.
Now let’s look at the second type of startup entrepreneur …
The More Established Startup Entrepreneur
This kind of entrepreneur has been in business for 2 or 3 years — and they realize that it’s time to scale. They think they have their brand and voice solidly built and defined. They are also generating some revenue and are, like nearly all startups, re-investing that revenue back into the business to further develop infrastructure, product, sales pipeline, etc. They’ve come to the point where they think their company has outgrown the original logo (which they probably spent next to nothing creating it on Fiverr). But now they realize that the logo design they spent $5 on is really limiting them, and they’re ready to step up their game.
This is where we come in — we bring the expertise that is necessary to take their brand and visually recreate it into something both highly creative and representative. Once they get to this point, they can expect to invest upwards of $10,000+ on a rebrand.
It’s key to note that the mindset associated to the following circumstances can change pretty tremendously if they’ve raised a large amount of seed capital — mainly because they’ve got a few bucks to spend or invest.
A start-up needs to get their branding right from the very beginning. A logo is only a small part of your entire brand. What’s more important is to get the “thinking” (ie. the brand strategy) nailed down right from the beginning. Having a great brand strategy, while having a mediocre logo, will still make your business successful. On the other-hand, a brilliant logo is not going to do much good for a business with crappy products or services, or if they have no idea who their real customers are that they are marketing to.
By paying for a professional branding consultant, the start-up can be confident that not just their logo, but their entire visual identity system that extends across all customer facing materials, will do their company justice. The company owner will be proud of the brand identity and the customer will be impressed and feel confident that the company can deliver its brand promise.
Branding & Design Consultant for Small Businesses.
Creative Director & Co-Founder of Rayvn
(Disclaimer: The contents of this article do not necessarily represent the views or policies of Rayvn. The views expressed are my own :) #logodesign #logo #graphicdesign #torontologodesign #startup #startuplife #torontostartup #startuptoronto #startuplogodesign #graphicdesign #websitedesign #branding #brandingagency #brandingstudio #brandingdesign #brandingdesigner #graphicdesigner #brandingexpert #torontobrandingexpert