Monday Mornings with Madison

An End to the Great Logo Debate

Lindon Leader — a highly regarded American graphic designer who studied at Stanford’s Art Center College of Design and was the recipient of more than 30 prestigious design awards worldwide – once said “I strive for two things in design:  simplicity and clarity.  Great design is born of those two things.”  When companies create a brand, the goal should be then that it is both simple and clear.  In that effort, company logos will generally fall into one of two categories.  Logos that have both the company’s name and an icon showcasing a product or service offered by the business are called descriptive.  Logos that just have a wordmark alone or a wordmark with a stylistic icon that does not reflect a product or service is referred to as non-descriptive.   The great debate that has raged for over 70 years is whether a company logo should be descriptive or non-descriptive.

Part of the discussion is fueled by the fact that logo designs go through trends, just like any other art form.   Graphic designers tend to follow trends much like sheep follow the herder.  This explains why corporate logos transitioned from having highly-detailed graphically illustrated icons in the 1950s and 60s to bold and colorful digitized logos in the 1980s and 90s, and then to much simpler and cleaner wordmarks without icons in the 21st century.  And, there is pressure to update logos based on the current trend.  Companies that fail to update their logos to match the style du jour risk looking outdated, stale and out-of-touch.  So is the right thing to just keep changing a logo to go with the stylistic trends of the times, or is an icon of a company’s product or service needed regardless of whether it matches the current style?

Descriptive or Non-Descriptive Logo:  That is the Question.

Was Burger King right to include a graphic of its flame-broiled burger buns in their logo?  Or, was McDonald’s right to use just their iconic giant golden arches to denote the M of their name McDonald’s?  Was Dunkin Donuts right to remove the cup of coffee from their famous logo and change the name to just Dunkin?   Was Domino’s Pizza right to make their logo into the shape of a pizza box, denoting the product?  Or, was Apple right to use a bitten apple to communicate their name, an icon that has nothing to do with their line of computer and phone products?   Is there a right and a wrong when it comes to product or service icons in logo design?  Or is this just a matter of taste and trend?

What’s more, is this issue even important enough for busy business leaders to spend time on?  Does logo design even matter?  For those who think logo design is a trifling matter — more about taste and opinion rather than empirical data and success — think again.   Top business schools have studied the impact of logo design on business and found that it has a significant impact on the company’s bottom line.  Logo design affects sales and trust.  (More about that in a minute.)

In fact, logo design matters a lot.  Case in point.  A consumer can buy Sketchers GORun Horizon running shoes on Amazon for $19.  Nike, on the other hand, sells its controversial Zoom Vaporfly 4% running shoes for $250.  Why such a huge difference in price for what is basically the same product — running shoes?

One could argue that there is a huge difference in the materials, design and quality of these two shoes.  That is a proven fact, not an opinion.  Two studies by two independent research firms unrelated or commissioned by Nike – one in November 2017 and one in February 2019 – found that Zoom Vaporfly 4% running shoes improved runners’ energy efficiency by 4% (hence the name).  This was attributed to the shoe’s soles, which have a fusion of foam (the kind found in airplane insulation) and a small carbon-fiber plate shaped like a spoon and curved in such a way that it theoretically gives a runner the most forward push with each stride they take.  Four percent is nothing to sneeze at.  That could cut nine minutes off a 3 ½ hour marathon.  Since marathons are usually won by mere seconds, not minutes, this is a huge difference.  That likely explains why Kenyan runner Geoffrey Kamworor, winner of the New York City Marathon, and Kenyan marathoner Eliud Kipchoge, the fastest marathoner in the world, wore Zoom Vaporfly 4% running shoes in their races.   In fact, the five fastest marathon times on record were achieved by male runners wearing Nike Zoom Vaporfly 4% shoes.  Given the proven technology and engineering of the shoes, it makes sense that Nike’s Zoom Vaporfly 4% running shoes should be more expensive than the Sketchers GORun Horizon, right?  True, but that really that should matter only to serious marathon runners; not the average consumer.

Why then do many consumers pay 13x more for one running shoe over another running shoe?  In fact, the Zoom Vaporfly 4% running shoes were so popular that stores kept running out of them across the U.S. last year.  Obviously, Nike makes an exceptionally good running shoe that incorporates top quality technology and materials, but does that justify charging 1300% more than the cost of a low-priced competitor?   Not really.  A big part of why Nike can charge so much more is the power of brand, which in the case of Nike, is tied to the Nike Swoosh (checkmark icon) and their slogan “Just do it.” What’s more, Nike’s powerful brand has been able to attract athletic and celebrity endorsements, which also drives sales.  But even Nike’s own logo has evolved over time.   Here is Nike’s logo design since inception.  It followed design trends, going from highly-detailed in the 50s and 60s to bold and colorful in the 80s and 90s, and then to cleaner and simpler in the last two decades.

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Also, nowhere does Nike’s brand include an icon showing footwear or sportswear of any kind.  So, while logo design matters and even the most iconic logos evolve, they don’t always have to be descriptive.  Does that mean product or service placement is unnecessary in logo design?  The answer is that it depends primarily on whether the company is a startup creating a logo for the first time or whether it is an established, well-known brand.

The Research

According to an article published in the Journal of Marketing Research, seven experimental studies were conducted to analyze the effect of logo design on brand equity for 597 companies.  The studies compared the impact of descriptive vs. non-descriptive logos on business. Researchers looked at 423 consumer brands. Using financial information (including net sales, advertising and R&D spend, along with total assets), they then asked assistants – who did not know the purpose of the study – to code whether these companies’ logos fit into 13 different design characteristics (including shape, symmetry, color, and whether they were descriptive or non-descriptive). Regression analysis allowed the researchers to explore the effect of descriptive logos on net sales with the financial details and logo design characteristics as control variables.  What the data showed is that descriptive logos had a greater positive effect on sales than non-descriptive logos.

Then, to test their findings, they looked at the logos of 174 early-stage startups.  The findings held true.  They presented their logos and product descriptions to 2,630 individuals and found that descriptive logos were more often associated with a higher willingness to buy.  However, although having a descriptive logo had a positive effect on brand equity for both familiar and unfamiliar brands, the magnitude of that positive effect was much smaller for familiar brands.  In other words, the more well-known the brand, the less that having a descriptive logo mattered.  Once familiarity was established, the descriptiveness of the logo became much less beneficial.  Moreover, descriptive logos actually had a negative effect on brands that dealt with sad or unpleasant topics such as funeral homes.

In sum, the studies revealed that it was usually easier for consumers to visually process descriptive logos across all different types of brands.  Descriptive brands were also considered ‘more authentic’ in the consumers’ eyes and those brands were seen more favorably.  And, descriptive logos strongly increased a consumers’ willingness to buy from the brand, thereby boosting net sales.

Piggybacking on the Journal of Marketing Research’s studies, Harvard Business Review did an analysis of their own and found that about 60% of companies today use a non-descriptive logo while 40% have a descriptive logo.  That is likely due to current logo design trends that favor simpler, cleaner wordmarks without icons, or with artistic but not descriptive icons.  And, yet, those non-descriptive logos are likely seen less favorably and trusted less, resulting in lower net sales.  Therefore, following design trends may not necessarily be the wisest course for new and less well-known businesses working on establishing a brand.  Food for thought.  But this should put an end to the Great Logo Debate, at least for now.

Quote of the Week

“A logo doesn’t sell (directly).  It identifies.” Paul Rand

 

© 2019, Written by Keren Peters-Atkinson, CMO, Madison Commercial Real Estate Services. All rights reserved.

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