Logo Design: $Hundreds to $Millions and why
Client: “A designer quoted me $1,000 for a logo. Is this a fair price, or are they ripping me of?”
Client’s friend: “That’s way too much. I can recommend someone who can do it for $50.”
This has happened to us many times. So, I’ve decided it’s time to detail the “why’s” and “why not’s” of logo design. This is a heated topic and there is a huge difference between a $50 logo from an web based company out of India, and the logo designed for a large Soda Company by an agency.
Discussing prices is touchy because it can easily become offensive. This post is not intended to discredit a startup with a limited budget who can only afford the lower priced logo design options. Neither is this post to convince anyone that they should buy a more expensive logo. The goal is to educate everyone on the spectrum to the difference between a small budget logo and a large budget logo. I want to make you aware of what you’re buying. I want you to have a realistic expectation of what your budget can afford you. This way you will not end up disappointed by what your budget allowed the designer to accomplish. There’s a logo for every price point, and there’s a good reason why each logo costs what does.
People outside of the design industry who don’t understand the nuances behind logo design are legitimately confused by logo pricing. Logo prices vary wildly, from $50 to potentially millions of dollars. How can the “same thing” have such a varying price range?
Ultimately, this is the crux of the matter… They are not the”same thing”.
While the pricing of logo design is much more complex than we can cover in a single article, I can break it down by simplifying things a bit and dividing logos into 3 price ranges: low ($100‐$1,000), mid ($1,000‐$10,000) and high ($10,000+). I’ll explain what the process is at each of these levels, and why the cost range is what it is.
What is a logo?
In order to qualify as a logo, a graphic must meet the following conditions.
- It must be a vector graphic, blown up to any size without the loss of quality
- It must clearly convey meaning even when scaled down to the size of the stamp or app icon
- It must be suitable for use in a variety of media (print, digital, engraving, embroidery etc.)
- It must be unique. There are no other businesses using the same graphic.
- If a graphic fails one of these checks, it was not created to professional standards, and it cannot be considered a real logo.
$5 “logos” are not logos
The reason I’m not even considering Fiverr as part of the legitimate logo design industry is that the results from Fiver (or places like it) are not logos. What you typically get from these types of places are stolen graphics placed on a white background (if you’re lucky), which makes them literally useless for any practical use.
Enough said about these types of graphics. Let’s move on to actual logos.
What’s the difference between low, mid and high end logo design services? The difference is in the process.
When I said that low end logos, mid logos and high end logos are not the same, what I was saying was that the process used to arrive at the final product differs considerably. While the final result might appear similar to an untrained eye, the hours of research and labor that went in to each logo are of a different magnitude.
This is excluding operating costs. A legitimate business pays taxes, healthcare, Accountant fees, and owns expensive professional design tools, software and equipment. People in Western Europe, North America and Australia have higher costs of living than Eastern Europe, South America, Africa or most Asian countries. All of these conditions factor into the designer’s rates. Someone might be able to offer the same level of service for a lower price because their operating costs are lower based on where they are in the world, but let’s put that aside for now and simply analyze man hours and effort.
The Client Dictates the Price
A big factor in pricing that is rarely discussed in design circles is that the client dictates the price. The value of the logo is not solely in the designer’s work but in client company’s potential to profit from said logo. A corporation who will profit in the millions every year from a branding project will pay more for a logo than a non‐profit or mom & pop local business.
Non‐profit organizations and local micro‐businesses have lower budgets and don’t expect a big return from a branding project. Designers often decide to lower their pricing in order to meet the needs of their less profitable clients.
Businesses who are serious about using design to gain more customers and be perceived as a premium brand should be willing to invest more into their logo, because this investment will lead directly to higher profit margins.
Two different companies could potentially pay different pricing for what would be considered the same amount of work. This is not unfair, it is called value based pricing. If the logo will help you gain more customers at a higher price point, this translates directly into profit. Designers who help you achieve this goal deserve a portion of the profit they help create. Think of it in terms of music. When a musician sells his song to be in a commercial, he gets paid based on the amount the song is used or played.
Low End logo design process
$100 is the least you can expect to pay for a decent professional logo, though by first world standards $100 is very cheap and impossible by some standards.
I have two explanations for how it’s possible for some designers to charge $100 per logo and still make a living:
- These designers are not full‐time designers.
- These designers create 10‐20 logos per month.
If a designer has a second job that’s paying the bills, or is still in college and their life is funded by parents and student loans, it figures that they won’t value their services as much. There is no need for the money to survive. They can afford to put a ton of work into a project and only get a fraction of what the work deserved.
A full‐time designer that is still somehow making a living creating $100 logos raise the question of “how much effort can a designer possibly put into a logo at this price?” If your logo is just one of a dozen or more a designer is working on that week, can you be confident in the quality of logo that you are getting? At $100 the entire process can be accomplished in a day, which explains why the price is so low. The question then remains, what steps were omitted to get it done so cheaply? With that said, do you want to put the logo that will represent your company for years to come into the hands of a student, a designer with a second job, or a designer who is juggling many other projects alongside yours?
In this category by raising your budget to $300-$500 will yield a much better logo, however the designer is still forced to fit crucial steps for a project in a short amount of time, or omit some all together. Corners have to be cut to make this budget work. There is no way to optimize logo design like an assembly line. Each logo is unique and the creative process can not fit into a few hours.
Typically, the first thing that is cut back or omitted is research. Design research is the first step in any design process. It’s an essential step, we need to establish what’s already present on the market, and how to differentiate from the client’s competitors. If this step is skipped, the resulting logo will likely be generic and cliché. It will resemble every other logo in the client’s respective market.
Without the much needed research we as the designer are left to create the logo based on client’s input alone, and then quickly move to the creation process. The process at this level involves:
- Asking client for design direction (favorite colors, fonts, symbols, etc.)
- Creating several variations quickly and offering the client to pick their favorite.
- Refining the chosen option based on client’s input.
- Sending the final logo and the invoice.
*Keep in mind at all levels that the larger the Logo Identity budget, the more time can and will be spent researching, creating and perfecting your final Logo.
Middle logo design process
In this category your budget will yield a solid design solution, provided your chosen designer has plenty of experience and adheres to professional standards. A complete logo design process involves the following phases:
- Researching the client and the competition.
- Setting the design direction (through the use of a design brief and/or a moodboard).
- Creating many design concepts.
- Refining concepts with the most potenal.
- Choosing the concept that best communicates the client’s values and brand message.
- Presenting the logo proposal to the client (with examples of everyday use).
- Revising the logo based on feedback (optional).
- Preparing multiple color and composition variations of the logo.
- Designing the branding guidelines
You can see that there is much more involved in the mid design process than in the low end. A single logo design project can take anywhere from 30 to 60 or more hours to complete. The project can last between 3 to 8 weeks, depending on the work load of the designer at the time, if there are additional graphics included with the logo and if there are multiple logo formats required.
High End logo design process
The high end logo design process follows a similar structure as a mid process. The key difference is that it usually involves a team of designers and marketers.
Instead of one dedicated professional, you have 2, 3 or even more. The entire team working to make your logo project a success. Due to the fact that there are more people and resources involved, you will receive a much more extensive process:
- The research phase is more thorough.
- More designers equals more ideas.
- Design may involve active participation of the client or customer focus group.
- Business naming and tag-lines are often included in the agency brand design package.
This type of process can last several months. Large companies with so much at stake wouldn’t dare rush this process. If they don’t let the agency get it right, it could potentially cost them large profits.
With a team of people involved, and all of them giving focused attention to your brand project, agency logo design pricing potentially have no limit. Pricing can reach into the millions for large clients such as Coca-Cola, General Motors or Apple.
Different processes deliver different results
A “deliverable” is an item that you as the client receive once the design process is complete. The more you invest in your project, the more deliverables you receive.
In the low end category, you get:
- A logo. That’s it.
With a mid‐budget logo you get:
- Multiple logo variations (color, black, inverse, vertical, horizontal, icon etc.)
- Essential brand style guide (depending on how much you’re paying, you might get a fully developed brand)
With a high‐end budget logo, you get:
- Brand strategy
- Multiple logo variations
- A fully developed brand
- brand name and tagline
Hopefully this post has shed some light on why logo prices vary so drastically. As you can see, designers are not trying to cheat their clients. Each client and their needs vary as much as the pricing itself. Designing a Logo Identity that communicates the brand and it’s message is one of the most challenging design projects there are. Not every designer is skilled at accomplishing this task proficiently. There’s no template or “best practice” that guarantees logo success. So much can go wrong when an inexperienced designer takes on a logo project. The company’s reputation is at stake, because logo is a business tool that wears so many hats. If a logo design project turns out unsuccessful, rebranding will invite even more costs. You’ll need to redesign and reprint all promo materials, rebrand your websites, apps, brochures, signage, vehicle graphics, business cards and business forms… The costs will add up to far more than paying more up front to get it right the first time. This is why bigger more experienced companies spend more on logo identity. Larger companies have likely experienced the costs of rebranding and avoid it when possible. Saving money by going with a low-cost logo today will most likely mean having to invest more money later to fix what isn’t working.
As a designer who has has been in the business since the early 90’s my advice is do not rush into a logo design project. Logo identity is a make or break prospect. If you don’t have the budget for a quality logo identity, you may need to wait and save up a solid budget rather than spending money on something you won’t be happy with and that will not work. However, after all of this you still choose to go with a low‐priced logo, please, do your research so you don’t get ripped off by a logo designer.