Changing your logo can be expensive – and that's not counting the multimillion-dollar creative fees that national design firms charge.
As Paul Veness, director of brand implementation company Endpoint, said in 2010, “...the cost of [executing] a rebranding is 20 to 30 times the creative budget. It’s everything from signage to staff uniforms to the IT back end.” But even that's not the biggest cost.
The biggest cost of changing your logo is the revenue you lose when your customers hate it. (And then paying to change back to your old logo if customers hate the new logo enough.)
Slower is better
Replacing or updating or improving an established logo can be unsettling to long-time customers who've grown accustomed to your corporate face (and have grown to like it).
Some brands have managed to immunize consumers against bad logos by coming up with one after another every few years. Microsoft, for example, has come up with at least five clunkers since its start in the Disco Era.
Some brands have been smart enough to avoid consumer rebellion against logo changes by making those changes ever so gradually. BMW, Nike, Apple and Shell, for example, have all been evolving their logos so subtly that they keep up with changing graphic tastes without anyone ever noticing the progression from one evolutionary step to the next.
But other brands have been neither as subtle nor as patient, and their radical logo changes have hurt them in the marketplace.
Changes for the worse
The latest example is Olive Garden.
Their sales have been doing poorly of late (though their logo wasn't to blame).
So when parent company Darden hatched a "brand renaissance" plan including new menu items, smaller plates and a new, as yet undisclosed advertising direction, it was only natural for them to throw a few million bucks Lippincott's way to signal the changes with a new logo which is not exactly enjoying rave reviews.
"Critics have said the updated logo is generic, with some saying it looks like a logo created by a first-year design student," Advertising Age reports. At the very least, it seems to lack the Italian paisan look and feel of the old one.
Maybe the new logo will work with consumers, and maybe it won't. But given recent history of logo changes, the odds are against it.
- Kraft – In 2009, Kraft walked away from a well-known and well-liked logo in favor of one with the company's full, official name. It told millions of consumers who already thought Kraft foods tasted good that they were "delicious" – in contrasting red type. When the company later split up into Kraft Food Group and Mondelez, Kraft went back to a slightly freshened version of the old logo.
- Tropicana – With their straw-stuck-into-an-orange visual, Tropicana had a great piece of nonverbal communication going – until 2009, when the same genius who'd messed with Pepsi's logo the year before came up with less communicative and evocative Tropicana packaging. After what Ad Age calls a "public relations fiasco" and a 20 percent sales drop in just two months, they went back to the old design.
- Pepsi – In 2008, as a result of a 27-page document titled "Breathtaking," in which Peter Arnell theorized that changing the Pepsi logo's white band from a wave to a smile-like shape would create a gravitational pull in supermarket soda aisles, Pepsi changed its logo. They also added a grin for Diet Pepsi and a laugh for Pepsi Max. The smile survived, but the grin and laugh were scrapped.
- JCPenney – When he was destroying store brands, price promotions and everything else loyal JCPenney shoppers liked about the store, then-CEO Ron Johnson had a new logo created to rub it in. One year, a 25 percent sales drop and a $985 million loss later, Johnson was gone, the store brands and price promotions were back. To make sure the customers they had left got the message, so was the old logo.
- Arby's – In honor of their 50th anniversary, Arby's made the ten-gallon hat in their logo 3D and abandoned their Western-style font for something that looks like lower-case Helvetica. What CMO Russ Klein called "small but significant changes," such as "the lowercase font and the apostrophe slicer icon...that communicate our point of differentiation, that we freshly slice meats daily in our restaurants” were supposed to "contemporize the look without losing what our most devoted customers love—namely the hat." But customers and design critics alike hated it. Among the thousands of outraged comments were: "It could as well be a logo for an auto parts company," "It makes the GAP logo look like the Sistine Chapel," [see below] and "the Pontiac Aztek of logos."
- The GAP – In 2008, North America president Marka Hansen and design agency Laird & Partners started developing a replacement for their 20-year-old logo. When the new logo rolled out in 2010, it inspired an "I think the new GAP logo sucks" Facebook page with thousands of comments, a Twitter account supposedly from the new logo itself tweeting how ugly it felt, and a design-a-new-GAP-logo contest, most of the entries for which used a four-letter word that rhymes with "GAP." The new logo took two years to develop. It was scrapped within one week.
Think and ask before you change
Sometimes brands change logos because management becomes bored with them. The problem is, management sees and thinks about their logo far more, and far more often, than consumers do. More often than not, customers aren't bored with the logo and still like it.
Sometimes they change because of esoteric changes in the company's name, ownership or structure. That has nothing to do with the taste of Kraft American singles, and while these changes may be important inside corporate headquarters, out there in the supermarkets, shoppers couldn't care less.
Whatever the brands above were thinking of, it wasn't their customers.
After The GAP pulled the plug on its one-week-old logo, Hansen posted, "Now, given the passionate outpouring from customers that followed, we've decided to engage in the dialogue, take their feedback on board and work together as we move ahead."
If she'd thought to "engage in the dialogue, take their feedback on board and work together as we move ahead" before the logo change, maybe she wouldn't have had to eat two years' development work and who knows how many dollars' worth of changing the changes afterwards.