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How Much Is A Great Business Logo Really Worth?

Posted: Thursday, June 30, 2011

A great logo can help a business project a positive image while a bad logo can bring a negative impression about a company. If a logo is the company spokesman, how much is it really
worth? Cheap logo designs are all over the Internet - logo designs under $150! $99 logo designs, $75 logo designs, $49 logo designs and even lower! You will easily find a wide range of prices for logo design on the Internet.

Be careful of cheap logo design offers, some designers may be using clip art. A logo design that includes a royalty free piece of clip art cannot be copyrighted. That same piece of clip art could be used on dozens of other logo designs. A designers portfolio should be displayed and there should be a wide variety of logo samples. Some logo designers charge one flat fee for a logo with no questions asked. Can you imagine Coca-Cola purchasing a logo design for $99? All designs are not equal. Some logo designers charge additional costs for extra colors, extra modifications and extra preliminary designs. How much is a logo design really worth? A logo design is more valuable to a company than a single spot illustration. A logo has more value than just the hours spent on creating it. It becomes the companies identity.

Professional graphic design rates average anywhere from $30 to $75 per hour. If you see a logo design priced at $125 and that designer charges $50 per hour for design work, do you assume that they spent 2.5 hours on your logo? That price would include the time spent to contact you, the research done on your company and competition, the preliminary ideas, the changes, the finalizing of the logo, the file prep for each different format, sending the logo, billing and allowing you to have all rights to the design. So how much time was actually spent creating your logo?

Many professional graphic designers would be hard pressed to create a top notch illustration for under $150 let alone a creative, well designed logo. So beware of logos priced under $150, you may get what you pay for. There's even more confusion about logo pricing. Some designers base their logo rates on several of these factors:

Logo Modifications - You could get charged for each time you want a change or modification to your logo. If a logo designer asks the right questions, does the research and stays in close communication with the client there should be no need for major changes during the creation of a logo design. Be a good communicator and explain to the logo designer exactly what you want your logo to be saying about your business.

Extra Colors - Printers charge more for extra colors. If a logo designer charges more for a two color logo than they do for a three color logo, get a detailed explanation as to why.
A logo designer should be able to decide for you the correct amount of preliminary designs it will require to create your perfect logo. An example would be asking for a yellow duck logo
design and changing your mind to a red dog design once the logos are presented to you.

Adding an identity program to your logo is a legitimate cost. Designing the business card, letterhead and envelope layouts are normally a higher priced package. You should receive camera ready files for each design.

There is a standard reference for pricing graphic design and corporate identity projects. Any logo designer can purchase the book. A professional graphic designer would have a tough time supporting a family and a studio designing all of their logos below $200.

I'm not writing this to give exact prices for a logo design because each logo designers circumstances are different. The standard logo design rates are based on two major components,
company size and application or distribution size. The majority of logo designs created over the Internet are created for small companies and individuals with limited application and distribution uses. Fortune 500 companies normally pay much higher logo design rates and use advertising agencies.

My conclusion is that the value of a logo should be based on a few important criteria:
1. Experience of the logo designer
2. Size & budget of the company using the logo
3. Scope and usage of the logo
4. Difficulty of the design

An individual or small company with small to average uses should be prepared to pay anywhere from $300 to $1500 for a top quality, professional logo design.
What's included with your logo? You will then have to pay another graphic designer or printer to create the correct files. Be aware of what file types you will be needing and ask your logo designer what file types are included in their price.

The most common file types needed are AI (Illustrator) and EPS for most professional print jobs. These are vector format files. These files should be in a CMYK color format. Be aware that not all colors translate well on the Internet, especially GIF files. Ask if the logo designer used web safe colors. You should receive crisp 72 dpi files for the Internet. Be sure and ask your logo designer about your logo colors. You will need this information each time your logo is printed. Ask your designer how long they keep your logo on file in case you lose your
versions later down the road.

You should also receive all rights (copyrights) to your logo. How long have they designed logos? In closing let me say that the information above is a personal opinion and is taken from years of searching logo design web sites and reading books on graphic design. An advertising agency handles logo design on a larger scale and incorporates an entire corporate identity service. Their logo design rates are many times higher than a graphic designers.

A. How to Manage Your Graphic Designer to Get Great Design for Your Nonprofit
Nothing is as compelling as managing the design, of a printed piece or web look for your organization, service or campaign. It's challenging to manage a designer's creativity into a design take that meets your organization's needs can be challenging. Over the years, I've devised a few strategies that ensure that the design process goes smoothly. When you do, you'll generate the design results that make the greatest impact for your organization:

Step One: Take your time to find the RIGHT designer.
The question is how do you find your stable of RIGHT designers? You're likely to need relationships with three or four designers. The number depends on the volume of design work, the range of looks you're trying to achieve, and the diversity of materials and online projects to be designed. Because I work with many clients with diverse needs, I require more of a range of design skills and price points than would any single nonprofit or foundation.

Here's how to find your designers:

Step Two: Gather favorite design samples Keep a folder of favorites, printed materials you identify as good design in the same range as your organization's image or the image you want to establish. Bookmark website designs in the same way.

Step Three: Compile your list of prospective designers Contact communications colleagues (make sure you like their design sensibility first, judging by their products) and ask for designer recommendations. Get basic information on pricing, work style, and client base.

Step Four: Hone your list to the top three or four by interviewing ten to twelve designers Contact the top ten to twelve before you have a design project ready to go. Here are some of the questions I ask prospective designers:
How long have you been designing? With this firm/working freelance?
Have you worked with nonprofit organizations? How did you get into design work for nonprofits?
Do you design for print and online media?
What is the average size (dollar-wise) of your design projects?
Take me through the design process for a brochure? Will you personally be designing our work, and be my point person? (for non-solo designers)
These are the quirks you'll face in designing for our nonprofit (explain any, from the Executive Director thinking she's a designer--and putting her stamp on every piece--to a boss who always changes his mind completely on what a piece should feature when he sees a design concept)

Step Five: Write a creative brief the moment you get a whiff of a pending design job
An effective creative brief gives the designer direction and provides your team with benchmarks against which to evaluate design concepts.

Spending the time to complete a thorough creative brief will save you a lot of time up front, and ensure that you get the design product you envisioned.

List, characterize and prioritize audiences Present Unique Selling Proposition(USP), one sentence about what makes the organization, program or service unique
Specify budget and time frame Outline internal review and approval process These five steps will lead you to strong relationships with the right designers. As a result, I guarantee that your print and online design work will be more effective than ever in engaging and spurring recognition from your target audiences.

It's likely that, when you do, you'll find some great design samples that will lead you to more effective (and maybe even less expensive) graphic design for your organization.

B. Should Creative Freelancers (Graphic Designers) Collaborate in How They Price Their Services?
I know this is a hot-button issue with freelancers; like owing a MAC or a PC, if you're a freelance designer, you probably have a strong opinion either way. That being said - no, creative freelancers should not, and in many cases can not collaborate over pricing services.

Over the years I've found the creative freelancers that are the most adamant about establishing price standards are the ones who have difficulty getting paid what they want. These freelancers see the problem of not getting paid what they think they're worth is due to other freelancers that aren't charging enough and "cheapening the industry". Assigning blame is always easier than accepting responsibility.

It's upsetting and frustrating not getting paid what you feel you're worth, and if you're in that position - I feel your pain. I would caution you not to blame other freelancers for the pricing challenge you're having. It should be up to each individual freelancer to ensure she/he gets paid what they're worth, shouldn't it?

Now that's out of the way, we'll look at some of the reasons why collaboration among designers to keep prices higher isn't such a practical idea.

Reason 1: Who gets to establish what is fair price for freelancing services?
Let's say you have 2 freelancers: Jon and Jane. Let's say they both agree to a universal pricing structure and charge the same $2000 price for developing a web site. If you're Jon you're thinking this is a pretty good deal - if you're Jane you're thinking this deal sucks.
As much as some freelancers would like to standardize pricing, it's too difficult when you incorporate the variables:

Cost of living
Experience and skill level

Reason 2: Ultimately clients decide what you get paid
If you're living in the States (as I do), we have a capitalistic, free market system whereby value/price is determined by supply, demand, needs and wants. Even though you're free to set whatever price you'd like ($1/hr or $1000/hr) the consumer market is going to dictate whether you can stay at that price level. If you can't, you'll have to drop your rate until you get to a point you can convince them you are worth your rate. Price is determined by perceived value - value seen through the eyes of the client. This means that if your clients see you as valuable compared to other options, you'll probably make more money.

Reason 3: It's Illegal, at least here in the States
Depending on the lengths freelancers, gas stations, the music industry, or any other group of business professionals try to control pricing is considered illegal. The term for this is price fixing or price collusion. Even if you were able to convince all of the freelancers in the world that they had to charge a minimum rate for their services, there are parts of the world that would consider that activity illegal. Visit http://en.wikipedia.org/wiki/Price_fixing to see how Wikipedia defines the term, notice that "setting a minimum price for goods/services" is included in the definition.

Reason 4: It's impractical and impossible to police
Even if freelancers were able to somehow get the majority of their colleagues to charge standard pricing there are always those that are willing to break the rules and charge whatever they want. There are always going to be designers that can't compete on value so they'll compete on price - they'll drop their price to get business.

Bottom Line:
If you're a freelancer that has a higher rate, don't worry about the cheaper options, if you can show your clients that you're worth more, you will get the business.



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