How much should you pay for branding?
If you’re reading this, it means that you understand how important branding is to the success and long-term viability of, really, any business.
Branding is not just your logo and the colors you use: it’s a strategic effort to establish a desired perception of your company in the minds of potential customers, to turn them from prospects into buyers.
Companies that invest heavily into building their brands consistently outperform the overall market, according to research by McKinsey and Interbrand. That’s insane.
So it stands to reason that if there’s anything that you should pay close attention to, it’s branding.
In this article I’ll answer to questions that you’re no doubt asking yourself right now:
- How much does branding cost, in general?
- And how much should you invest in it, specifically?
Possible price ranges
Ever been car shopping? You can spend $500 on a beater car that’ll hold you over for the next two months and possibly break down on you in the middle of the highway, or you can spend $450,000 on a top-of-the-line Rolls-Royce that will make you feel like you’re the king of the world when you drive it. (Both are sure to turn heads, but for different reasons.)
As it is with cars, so it is with branding services. The possibilities are literally endless, but for simplicity’s sake I’m going to outline the basic tiers and how to think about them. I’m basing these on my five years of experience in the industry.
In this price bracket, you’ll find the used Corollas of branding: Very affordable, functional but not the most reliable, and definitely a dime a dozen. If you need a visual identity for the sake of having one, you’ll find just what you need here.
- You’ll be working with a freelance graphic designer or a paint-by-numbers marketing agency
- Expect either next-to-no input on your end or having to micromanage aesthetic decisions
- Creative direction informed by questionnaire and your aesthetic preferences rather than brand strategy
- Expect a logo design and basic visual identity of decent quality
Basically: At this price level, you’re paying for graphic design services, not branding. As far as graphic design services go, you can find some solid freelancers in this bracket—but don’t expect them to bring high-level strategic thinking.
The solutions in this bracket are like Volvo station-wagons: Well-engineered, reliable, sensible purchases.
- Expect to be working with a competent branding consultant or a very small firm
- Your brand strategy will receive attention, but more likely on a surface level
- You and other stakeholders will likely be involved throughout the process
- Brand messaging and naming (if you need it) are sometimes included in the scope of work
- Expect a very high-quality logo and visual identity system, informed by your brand strategy and designed for longevity
Basically: At this level of investment, you’ll get something you can grow with, that’s high quality and sophisticated, and that’ll last you (with the occasional tweak) for the next 5 or 10 years without causing you any grief.
At this point, you’re shopping for a Porsche or other entry-level luxury sports car: spendy, but extremely well-engineered, with special luxury finishes and extreme attention to detail, and with a seriously powerful engine.
- Expect to be working with a highly skilled and experienced solo consultant and a small team of subcontractors or a high-end boutique firm
- In-depth brand strategy process facilitated by a senior brand strategist, likely including independent research
- Brand messaging and naming (if you need it) crafted by copywriters in collaboration with brand strategist
- Top-notch visual identity system with a suite of collateral assets ready out of the box
In this bracket, you’re working with a world-renowned design firm like CGHNYC or Pentagram, or a global advertising agency like Ogilvy, Saatchi & Saatchi, or Bartle Bogle Hegarty.
The pricing increases exponentially in this bracket: even if you’re only a startup you might be paying $90,000 just for brand strategy, $75,000 for naming, another $75,000 for messaging, $150,000 for your visual identity system, $100,000 for your website, and another $250,000 for an advertising campaign.
You’re no longer shopping for a car: you’re buying a tank that will bulldoze everything in its way. Unless you’re a global brand like Burger King or a late-stage startup with hundreds of thousands of dollars burning a hole in your pocket, stay away.
How to set your budget
So, I’ve already advised against investing in the branding equivalent of an M1 Abrams tank. But what is an appropriate amount of money to invest into your branding?
The appropriate branding budget partly depends on the nature of your business.
If marketing is a primary revenue driver for your company, you should be investing more into your branding. If direct sales is your primary revenue driver, you can get away with spending less. Keep that in mind as I make some general recommendations below:
Pre-launch or early-stage
Invest as much as you can comfortably afford (after investing in product and getting initial validation of course) but no more than $10k.
Why? Spend as much as you can comfortably afford because new businesses live and die by their ability to establish trust, particularly in an online setting. Don’t spend more than $10k because starting a business is a high-risk venture that isn’t guaranteed to succeed. Also keep in mind that, until your business reaches a certain level of maturity, your brand strategy—and thus your identity—is likely going to change radically. Count on rebranding within the next one or two years if your startup is successful.
If you’re making, for example, $1 million per year with relatively high margins and want to take your branding to the next level, I think you ought to set aside 2-4% of your annual revenue for the project—but no more than $100k unless you’re making at least $10 million per year.
Why? Because when you start approaching the 7-figure mark, you start competing with some really strong brands. To construct a successful identity that can rival (and crush) those of your competitors, requires a lot more attention to brand strategy and a much more sophisticated execution. At the same time, you don’t want to stretch yourself thin in order to work with an agency that regularly works with billion-dollar brands, because they’re simply not going to give you the attention you need.
Special case for consultants and soloists
If you’re a soloist, it’s a totally different story. If the bulk of your revenue is profit, it’s very easy to justify investing as much as 10% of your annual revenue in your branding in order to accelerate your growth.
My own pricing
One reason why branding pricing is such a nebulous and confusing subject for clients is that there is very little transparency in the creative industry about pricing. The only reason I’m able to speak intelligently on the subject is that I know a lot of agencies and freelance consultants and have gotten an inside peek into how the industry works.
I want to break the trend of pricing obscurity by being as transparent and straightforward as possible. So, here is what I charge currently (and what I have charged for real projects in the past):
Pre-launch/early-stage brand sprint: $6k
Over the past four years of being in business, I have developed a highly efficient process for branding pre-launch and early-stage companies. It’s a very fast-paced process that takes four weeks from start to finish. The investment is $6k and you get everything you need to launch your brand.
Rebranding something established: $10-$35k
When it comes to rebranding established businesses, it’s harder to set a fixed price. Every client has different needs, but in general I typically charge between $10k up to $35k for the works: in-depth brand strategy, naming, brand messaging, visual identity, and a solid website.
Pricing examples, past projects
To be even more transparent with you, here is what I charged for my five most recent client projects—and what the scope of work included for each of them:
- $5.1k — early-stage consulting business; brand sprint encompassing strategy basics, visual identity design, and marketing website
- $6k — pre-launch DTC e-commerce business; brand sprint encompassing strategy basics, brand messaging kit, visual identity design, and starter e-commerce site
- $4k — rapidly growing consulting business; in-depth brand strategy engagement staking out a clear direction for positioning, messaging, and marketing channels to focus on
- $21.5k — established auto sales business; in-depth brand strategy, naming, brand messaging, visual identity system, and UX/UI project consulting
- $30k — well-known personal brand; in-depth brand strategy, brand messaging, visual identity system, extensive website
The key takeaways
You’ll notice that I didn’t include price ranges below the $2k mark in this post. In the $0-$2k range you are looking at services like Fiverr, 99Designs, and free logo makers. Using our automobile analogy from earlier, these are the beater cars of the branding world. I’m of the firm belief that if you can’t spend at least $2k for a logo, you’re better off DIYing it. Spending a few hundred dollars or even a grand on one of these marketplaces is equal to flushing money down the toilet.
The key takeaways of this article to remember are these:
- $2k–$5k range = where you find the used Corollas of branding packages. They get the job done, but won’t impress anyone. Mileage may vary.
- $5k–$20k range = where you find the modern Volvo station wagons of branding services. Reliable, dependent, generally sound investments.
- $20k–$90k range = the Porsches of branding. Exciting, luxurious, but only for the very rich.
If you’re pre-launch or early-stage (especially B2C), be careful to balance the need to give your brand enough of a push early on with the need to limit your downside in case your business doesn’t take off. Also remember that your branding is likely going to change in the first one or two years if your business is successful.
And if you’re looking for an expert to take your brand to the next level, schedule a free discovery call with me to see how I can help you.
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