Before you start thinking about designing a business card or picking colors for your letterhead, you need a logo. Featuring your company name, embellished with a little color and perhaps a few graphic touches here and there, your logo is your company's most important design element because it's the basis for all your other marketing materials: stationery, packaging, promotional materials and signage.
For example, say your product is an organic facial cream you'll be marketing to health-conscious consumers. Your logo should represent your product's best benefits--being all natural and environmentally sound. Creating a simple, no-nonsense logo using earth tones and a plain typeface will give the impression of a product that's "back to basics," which is exactly what you want to achieve. Take that same product and give it a slick, high-tech look with neon colors, however, and people won't associate your logo with the down-to-earth product you're selling.
Logos come in two basic forms: abstract symbols (like the apple in Apple Computer) or logotypes, a stylized rendition of your company's name. You can also use a combination of both.
Trying to create a logo on your own may seem like the best way to avoid the high costs of going to a professional design firm, which will charge anywhere from $4,000 to $15,000 for a logo alone. However, be aware that there are thousands of independent designers around who charge much less. Remember that a good logo should last at least 10 years. If you look at the amortization of that cost over a 10-year period, it doesn't seem so bad.
Even if you have a good eye for color and a sense of what you want your logo to look like, you should still consult a professional designer. Why? They know whether or not a logo design will transfer easily into print or onto a sign, while you might come up with a beautiful design that can't be transferred or would cost too much to be printed. Your logo is the foundation for all your promotional materials, so this is one area where spending a little more now really pays off later.