Why do some companies choose to pay millions for a logo when it can be purchased online for a few thousand?
Open editorial column (open ed) in Dagens Næringsliv 18.02.2019.
By Wanda Grimsgaard
The National Museum in Norway and Deichman (Oslo Municipality's library), recently launched new logos. In the media, we often read about companies being criticised for the money involved in developing new logos. Norsk Tipping, for example, spent NOK 100 million and Hydro NOK 200 millioner on developing new logos.
What makes companies pay a lot for a logo when it can be purchased cheaply online?
The logo identifies the company and influences everything it is and stands for. It's the name and logo of the company that people remember, that they refer to and that is always present. The logo generates associations, which in the best case create relationships, loyalty and pride amongst those who work at the company and those who buy the company's products or services.
Such associations can be worth much more than the cost of developing them. To create the associations that give an advantage, a more thorough process is required than just drawing a graphical form on the name.
What is often referred to as the cost of a logo is usually the whole process of developing the logo, visual identity, signage and other profile material. The scope of the process determines the price. In the book Design og strategi [Design and Strategy] I identified the process through six phases that represent six steps to a successful logo.
- In the initiation phase, we clarify the problem and identify the cause. Why do we need a new logo? Are there more players in the market, greater competition, lower sales? Is the logo outdated? What about the strategy, is that outdated too? Do we see any threats or obstacles?
- In the insight phase, we do a situational analysis; examine the competitive situation, brand awareness and reputation. We analyse the target group; what are their needs and preferences? For example, what does the user think about the product or service we offer? It's about knowing and understanding - not just believing. We need to know the current situation in order to choose the desired situation (goal) and develop a strategy.
- In the strategy phase, we define the identity through three or four core values. When the core values are reflected in the company's logo, communication, products/services and behaviour, a strong identity is created that reflects a clear image in the market - and in the best case a unique position. Position refers to the place the company occupies in the market and in the customer's awareness; a set of mental perceptions/assumptions that guide the customer's choice in a buying situation. Position is strategy. It is about how we will compete in the market. Should we compete on price and offer the same as our competitors, only cheaper? Or should we offer something unique, differentiate ourselves and take a position? Such strategic choices will influence the design of the logo.
- In the design phase, se create the visual design. The challenge is to link strategy and design. The core values are incorporated in all the phases of the logo design. If one of the values is competence, which font expresses competence - and which colour; yellow or blue? Should the logo signal low price (inexpensive) or high price (quality)? Can we create a slogan that expresses the position and signals the meaningful associations?
- In the production phase, the logo is implemented on current profile bearers. Choice of technology, production process and materials depending on what is to be produced.
- In the management phase, we develop a profile guide to ensure holistic and consistent use of the logo, so that it appears as similar and recognisable as possible in all contexts. If the logo is a registered trademark, the ® symbol can be used.
Hvis vi gjennom en slik logoprosess klarer å skape noen assosiasjoner som gjør en forskjell, kan det være billig å bruke millioner i stedet for tusenlapper på en logo. En bevisst logoprosess er nødvendig om man vil drive målrettet, øke konkurransekraften og skape en merkevare.
If we through such a logo process manage to create some associations that make a difference, it can be cheap to spend millions instead of thousands on a logo. A conscious logo process is necessary if you want to operate in a targeted manner, increase competitiveness and create brand value.
Reference: The article is published in Dagens Næringsliv 18.02.2019
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