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Does a young company need to spend money on design?

When you start a new business, you always have a choice: order a website from a freelancer or contact an agency. On the one hand, it makes more sense for a new business to spend all its money on a product. On the other hand, in some industries, it will not be possible to launch sales without a qualitative visual identity. It turns out that you have to invest a lot of money in the design even before starting a business.

In this article, we will cover both cases. First, let's discuss a few common situations when a startup cannot do without investments in design and content. And then we will give a few examples of when it seems irrational to us to spend money on business packaging.

What is business packaging?

We will refer to packaging as everything related to the appearance of the product, promotional materials and points of contact with the client. For example, the packaging includes identity, presentations, videos and websites. Packaging is all the design and content that accompanies the product and is visible to the client or your partners.

When it makes sense to spend money on design and packaging

Case 1. You need a corporate identity right away because there are a lot of points of contact

In some startups, a large volume of customers or users is one of the key ideas of the business model. For example, a marketplace will not make money if hundreds of thousands of transactions are not made on it every day. In startups, where it is important to immediately replicate the product to a large number of customers, it is important to work out all the points of contact from the first day.

For example, if the marketplace has an outdated design, and the points of issue of power banks are gray and inconspicuous, it will hinder sales. If there is no revenue, the business will not start developing. In such startups, it makes sense to invest in packaging from day one. If you don’t deal with the brand and identity from the very beginning, but invest, for example, in a few years, then changing the appearance of all points of contact will be expensive. In order not to overpay in the future, it is logical to invest in the design right away.

If you do not invest in the corporate identity at the very beginning, but invest later, you will have to change the design of thousands of branded devices.

Case 2. I want to be seen better or show something that does not exist yet

Often in retail, they use not photographs of things, but their renders - 3D models, drawings, and pictures, which are brought to perfection. For example, on the Apple and Samsung website, you will not see photographs of phones, but their models. Just getting the perfect photo is difficult, and the picture can be drawn exactly as needed in the marketing department. This works not only with gadgets: we often see renders of cars, real estate, and even books, and do not even think that in reality, they do not look so perfect.

Therefore, in a business that sells a physical product, it is important to pay attention to design and packaging at the earliest stage. Beautiful, detailed renders sell much better than photos. Especially when it comes to products that should broadcast the status of the owner. High-quality renders will look better on a modern, laconic site, and the site needs branding. It turns out that if a business sells a premium physical product, then you need to invest in design from day one.

There are also startups in which a product needs to be presented to a mass audience before it is manufactured. For example, if you are raising money on Kickstarter for the production of a new gadget, then for now you can only show pictures. It is through images and design that you need to create trust and evoke an emotional response from future buyers so that they decide to buy a non-existent thing.

Case 3. Design is part of the product

In some companies, the product is inextricably linked with design. This is true for most of today's online services. For example, if you are developing a mobile application, clear packaging and strong design are important right from the start. A prototype for researching consumer problems or testing hypotheses may well be assembled in the simplest design, but the release version of the mass application is no longer there. Otherwise, entrepreneurs risk losing to competitors at the start. In offline business, there are also situations when the design is part of the product.

Typically, these are service businesses that create an experience for the client. For example, a restaurant is not just delicious food, it is an experience: you pay attention to the interior, to the neatness of the staff, to the dishes. All this is the packaging: it is profitable for a restaurateur to immediately spend money on design and open an institution with an impressive interior, and not with bare walls.

When there is no point in investing in design

Case 1. When you need to start as quickly as possible

Often in startups, you need to release a product as early as possible. The more time it takes to prepare, the more chances your competitors have: they can accidentally or intentionally create a copy of your product and launch earlier. Then it will be easier for them to take market share and start making money from your customers. Typically, a strong design is not delivered in record time. If your task is to launch as early as possible, you need to reduce the requirements for the visual component and not spend too much money on the design. Otherwise, you risk being disappointed, delaying the process, creating stress for yourself and the contractor.

Case 2. When there is no money or the last money is spent on design

If you start a business at your own expense - without the support of investors or funds - you save every ruble. In business, you cannot calculate everything with 100% accuracy, so some items of expenditure will definitely increase. As a result, a situation may arise that you have too little or nothing left for design. Of course, in such a situation, it makes no economic sense to spend money on packaging a business. The cheap design will be of poor quality and, in fact, useless. If you have the last hundred thousand rubles before starting a business, it is better to launch an advertising campaign.

Case 3. The design does not play a role in the first sales: they have already taken place or are provided

It happens that design does not play a role in the business at all. For example, if you are developing the world's most advanced turbojet engine, all aircraft manufacturers will come to you. The website, presentation, and expensive video will not affect their desire to buy your product, so there is no point in spending money on design in such a business. Some companies are created for a specific service task and work for only one client. For example, to serve the logistics of an international company or to help find merchandisers in the largest national supermarket chain. In such companies, it is not even necessary to have a sales department, so the design is definitely not a priority.

If you understand that the first sales are definitely guaranteed to you without design, you shouldn't spend money on it. Perhaps you have one of those rare occasions where business packaging doesn't matter.

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