I am disturbed by a post in the Graphic Design forum on About.com concerning a recent article in Entrepreneur magazine. In it the firm, LogoWorks, joins with the magazine to do a Ugly Logo contest. The article is basically a plug for their services as a logo farm. They produce logos and identity products on the cheap. They ridicule the GAG organization for setting pricing guidelines at a point that some small businesses would balk at paying. They say that the best solution may be a cheap solution, after all the logo is not what they should be concentrating on in the first place.
I don't begrudge their choice to market themselves as cheap. But I have a problem with them using a prominent magazine to besmirch the whole graphic design industry, just to gain market share. One day that can backfire.
But this leads into an interesting dilemma. How do businesses start out right, for less? Do they really need to buy an expensive logo, when they can get a well-designed logo for a small amount or less? If the logo doesn't grow with them, isn't it easy just to get something now, and pay more later for a better logo when they have the money?
The problem is that the logo is not understood by many in the first place--even some designers. It is not simply a commodity that you can purchased to make your business appear better than it really is. It also is not an adornment that everyone needs, in order to look legitimate. The logo is actually a promise, an investment, and a part of a branding strategy. So to discuss the need of a logo for a fledgling business is probably the wrong place to start. Everything starts with the business planning.
If you have done an analysis of your target market, and know who you are and what you offer that the target market will be attracted to, and you know that your target market is sustainable as a monetary support for your business, then you know what you need to communicate to this audience. For instance, if your airline business caters to people looking for cheap airline fairs, you probably will not provide them with first-class amenities, nor will this audience expect them. They expect a certain experience for the exchange for a cheap flight--from here to there. On the other hand, if you are a luxury ocean liner, the expectation for great amenities supercedes pricing concerns.
As a result your branding strategy, and marketing efforts need to reflect what your audience needs to know to be attracted to your services, and eventually become loyal customers. The logo is a part of that strategy. In some business cases the logo will be more critical than in other business cases. But the fact remains that the logo must reflect who you are, and it must communicate to your market at an emotional level.
Regardless, the logo speaks for you even when you are not around to explain your business. So how do you put a price tag on that type of power? It depends. If you understand its power on the business ROI you will see this as a great investment in the future of your company. If not, you may be content to change your logo every few years. But your target market will be confused and eventually uninterested.