More than ever, small business owners understand the importance of having a strong brand. And a logo is often considered a critical component of a company’s brand.

But many startups and small business owners are also cash-strapped. And every successful business owner trains themselves to look carefully at any business expense and weigh the benefits of the purchase compared to the cost. So if you have limited funds, you may wonder: Can I get a good, low-cost logo design using an online logo maker tool? How much do I want to spend? Do I need a free, cheap, or just affordable logo design?

To help answer these questions, let me walk you through how a few of these tools and websites work so you can get a low-cost logo for your small business. For my example, I am using a fictional business called 2 Potatoes Restaurant.

Free online logo design

There are many websites that say they offer free logo design, but few actually deliver a logo for free. Many of them only allow you to try things out for free, but if you want to be able to download a logo file, you need to pay.

Or, some of them will let you download only a low-resolution file for free, and you need to pay for higher resolution or vector files.

For example, look at this screenshot from Free Logo Design. For free, you are only able to get a 200 x 200 .png file of your logo. A small .png file may work on your website, but it would not work on a business card, a printed flyer, signage or t-shirts. It would not look crisp when enlarged or when printed.

Online logo maker tools for text

To keep things simple, you may want to consider a logo without an icon or symbol. These are sometimes called a wordmark. Examples of companies with wordmarks are Coca-Cola, Google, Crate & Barrel, Johnson & Johnson, and Tiffany & Co.

Two online logo maker websites where you can create a free, simple text-only logo are SupaLogo or CoolText.

Supalogo

With Supalogo you just type in the name of your company and choose a color and font. If you know what you want, it’s very straightforward. The problem is that the only file type you get is a .png. You can specify the size of the .png but this type of file is limiting because it’s not a vector-based file. Vector files are best because you can scale them to any size and they still look good. Plus, they have transparent backgrounds and no jagged edges. For instance, you wouldn’t want to get your restaurant’s new sign created using a .png logo file. So, I don’t think this will work for 2 Potatoes Restaurant.

CoolText

The Cool Text Graphics Generator works similarly. But, my gawd, is this website stuck in the 90s? At first glance it appears impossible to get anything related to a professional logo design here. If you monkey around with the tool, turn off the gradients and shadows you may be able to find something for some products, but honestly, you’re probably doing yourself more harm than good using this service.

Remember, your logo represents your company. It gives prospects an idea of what to expect from your product or service. The results from using this tool would be wildly off-target for many businesses. I don’t want my 2 Potatoes Restaurant to appear cheap or gimmicky. It’s difficult to recommend this tool without serious reservations.

Low-cost online logo design tools

If you’re willing to pay even a little, there are many low-cost logo design tools available online. These are web-based tools that allow you to choose a few options and then logos are generated for you. I am highlighting two here: LogoMaker and Looka (formerly Logojoy) and TailorBrands. There are many, many, many logo design websites. By covering these three, you can see the typical process that you will go through using any of the online logo design tools.

LogoMaker.com

LogoMaker is a DIY online tool that features 10,000 logo design templates to choose from. Expect to pay around $39.95 for a logo.

You type in your company information into a form and ta-da you have lots of logo options. In fact, I kept hitting “next” over and over again and never got to the end of these logo previews. I think I could eventually scroll through all 10,000 options. Some of the options were generic, some had icons that suggested a restaurant, many were clearly for other popular businesses types like painters, handyman services, pet-related business, etc.

After you choose one design, you go to an editing tool where you can make a lot of changes. You can change the font, the color of the typography or the other graphics. If you have chosen an icon or symbol, you can place in different positions compared to the top (left, right, centered above, etc.)

You can do all of this work without having to pay for anything. So this could be a fun tool to help you explore lots of different design ideas. Once you have the design finished and want to be able to download your logo, there is a fee. They include vector .eps files in their package which is the most versatile and highest-resolution file type. Note: They try to sell you a lot of extras like domain name registration, so it can be difficult to pay for just the logo.

Looka (formerly Logojoy)

Another popular online logo maker website is Looka. They claim to be an AI (artificial intelligence) powered platform with more than 5 million customers.

Here’s the process for creating a logo. You enter your company name and type of business (for my example, I put in restaurant). Then, you are shown about 20 sample logos and you pick what you like. These are not typeset with your company name at this point, and not all were specifically restaurant-focused, some were more general. They showed a variety of colors, fonts and styles of icons, and you are asked to pick up to five that you like.

Next, you are asked to select up to two “colors styles” that you like. These are palettes of nine colors that fall into five major categories. Then, you are asked to select up to three colors that you like.

Finally, you get to search for icons that would appropriate for your logo. They have tons! I was a bit surprised that an AI-drive tool was not more capable of filtering the choices or suggesting better options. But I found illustrated potatoes plus a lot of other options that related to restaurants. You can choose up to five icons. Then you get a big logo reveal. Note: You are immediately blocked from viewing the options until you register.

From this point, you choose one logo as the starting point and then go into their editing window. You have the ability to edit pretty much everything: the typeface, the icon, the background color, and shape.

Tailor Brands

The process for creating a logo with Tailor Brands feels a little more magical. According to their site, their logo creator works “by analyzing the information you entered, as well as taking your preferences on what fonts and styles you like based on our suggestions to show your brand identity that you’ll love, because you had a hand in creating it.” They use an algorithm to drive the process of getting to your ideal logo.

This is how their online logo maker works. You begin by typing in details about your business name, your industry and a little about what makes your company unique. For this sample, I chose an “icon brand” so I then get the option of picking an icon. As I searched for “potato” I started to recognize the same potato clip art that I’d seen in many of these logo design tools.

But after that, the process does become very interesting. You are prompted to choose styles of fonts to show them which styles suit you best. Then you are immediately given some options for logo designs that pair fonts with the icon you chose. I do like this feature and it reminds me of how Branding Compass recommends fonts and colors based on the information you provide.

In the end, you do have the ability to edit much of the logo including changing the font, the icon, the arrangement of elements, and the colors.

How to get the best designed logo using an online logo maker tool

Each online logo tool has a slightly different step-by-step process, but eventually you get to an editing screen and can customize their pre-built logos.

The quantity, quality, and styles vary from one online logo maker to another. If you just rely on the options presented to you, many are quite ugly. Many look cheap, gaudy or out-of-date and may be a real turn-off to your potential customers. Remember, the point of a logo is to create an image in your prospects’ mind about what to expect from your product or service. I doubt that you want to be viewed as fly-by-night, out of touch, or unprofessional.

Additionally, I saw the same clipart in many of these different tools, so it’s unlikely that your logo will be truly unique. Your business is unique and if you choose to use one of these icons, you’ll want to do some research to ensure that there is not another competing company using the same logo.

However, with the right editing and design finesse, each website has a few designs that could work for some businesses.

Spend the time to make it work

If you decide to design your own logo using an online tool, be prepared to spend significant time on the project. Navigating through the sheer volume of online logo design tools and then the various icons and styles that you can create within each one takes a lot of patience.

Have a clear vision for your brand

These online tool makers provide lots of design options but little help in understanding what visual style is appropriate for your business. Remember, there is no singular “best” font, color or style for a logo. An effective logo is one that represents what you want people to think about a company or product.

How do you know what font or color to choose for your logo design?

The best typeface and color options for your logo will suggest visually the experience or benefits of your brand. For example, are you bold, precise or inspiring? If you know the traits you are trying to visualize it will be easier for you to recognize an icon or typeface that can represent your brand.

Get the customer point of view, not yours.

The most important advice is to stop thinking about what you like and think about what your customers like. Put yourself in your customers’ shoes and consider what will appeal to them.

It’s a common mistake for small business owners to assume that their clients will be very similar to themselves. While this may be true, don’t assume it’s the case until you do some research. Start by thinking about who is most likely to buy from you.

A good logo will attract people to your company or product. Everyone has different tastes but if you understand your ideal customer, you’ll know what they tend to like or dislike. Who is most likely to buy from you?

Differentiate from your competition.

It’s important not to pick designs, colors or fonts without looking at what your competitors are doing.

For example, it’s not a great idea for me to choose a square, blue logo if the restaurant down the street will have a similar looking logo. Your logo should stand apart from your competitors.

Find out who your competitors are. Write down how you are unique and different from each one. Finally, compare any logo design you are finalizing with the logos of any of your competitors. Make sure yours is different.

Note any chosen fonts and colors

Once you have finalized your logo, make sure you know what typeface you have used. You may want to continue to use that font in other places to create continuity with your brand image.

Additionally, and probably more importantly, know the final colors that were used. You will definitely want to use these as accent colors on your business card, website, social media graphics, and other marketing materials.

3 questions to answer about your business before you start to design your logo

Doing some prep work before you head to any of these logo design websites will help you get better results. Spend some time thinking about each of these questions in advance:

1. What makes my product or service unique and special? List adjectives to describe your benefits. Find fonts and colors that fit with those adjectives.
2. Who is most likely to buy from me? Who are they, and what do they like and dislike? Write a description of your ideal customer.
3. Who are my competitors? Review each of their logos so you ensure that yours looks different.

After you’ve completed your logo, you’ll want to test it out to see if it’s really helping build the right brand image for your company or product.

Tip: Branding Compass is a fast and low-cost way to help you think through these important questions and get expert recommendation on fonts or colors that will work to express your brand. It will also help you build a highly-visual ideal customer profile as well as give you a quick overview of all your competitors.