You're really just losing cheap customers. Cheap customers are not fun to work with.

Never ever compete on price. That's rule number one in the consulting industry. If there's a group of people racing to the bottom on price, then by definition they're not your competition.

"We offer... consulting services at rates that are much less than you might find from other US based software firms"

You'll notice that nowhere do I say we're prepared to compete against teams of highschool kids in Bangladesh on price.

I still like to think I'm competing on quality rather than price. The fact that I bill less for my time when I've got sand between my toes is frankly a bit of a gimmick. Some clients see it as a positive that they're contributing to my suntan.

Shit breaks when something's poorly coded, and has to be fixed (though, the DailyWTF would suggest otherwise). Whereas most people don't care if something's poorly designed and feel that a designer isn't necessary to just get it out there. Designers are fretting about losing mid/small-sized clients to stock templates, much in the same way that most businesses pre-DTP would buy stock letterhead and forms.

It's irrational, but when all of the clients talk about getting rid of the prissy designer one gets jumpy.

But cheap customers are often better than no customers, and a friend of mine picked up some of his larger accounts starting off with some loss leader logo design promotions.

It's galling for the UK government to promote a service to the exact types of businesses that you think that service is fine for?

I mean, didn't they recommend it on a resource dedicated to start-ups?

They also might take exception to the notion that race-to-the-bottom logo work fits under the site's "creating a brand" heading; 99designs is exactly the resource for businesses where visual branding doesn't matter much (which in fairness is a lot of them).

I considered a start-up roughly equivalent to the sort of cash-strapped small business you think 99designs is fine for.

Whereas you're primarily drawing a line between start-ups and those other businesses.

99designs is a very nice way to find someone to work with long term when you have limited design needs (and money) up-front.

Startups will then look at the fact that they spend more money on design than SW tools, yet their competitor just spent $1k for all the design on their site and is doing really well. The only ppl who know they were using 99designs are others in the industry.

Over time this will disrupt the design industry (at least for SW products) -- and I don't think it can be stopped. But I don't think its necessarily a bad thing at all.

I have used 99designs and I didn't like it. My personal opinion, based on my little experience, is it is costly for the services offered. For the record, I have used ODesk, Elance and Freelancer too. When I use these outsourcing sites (including 99designs), I look at both cost and service. Quality, trust, dedication, promptness and professionalism are all part of service. Yes cost is a very important factor. When you have your own business and you need service, like me, you would be looking at these factors carefully too. You look at the service, compare and then you decide on price. It's a capitalistic free economy where no one can dictate a price. Price is dictated by the demands and what the consumers are willing to pay.

I will give you a real life example, my example. I needed some graphic designs for my iphone app. I posted the requirements on all 4 sites I mentioned. I received over 200 bids. Bid ranged from $1,800 to $5 (Yes $5!). I carefully verified all of their work/portfolios, exchanged emails and reviewed their responses (learned a lot from this experience, template responses or try to oversell with superlative words, etc.). Out of all, one designer from Argentina caught my attention. She kept telling how much she wanted to design my graphics. She didn't want anything upfront, in fact, she even said she didn't even want any money if I am not satisfied with her work. She gave me a framework on when and how she would submit her work to me for review and if I didn't like the work she would totally redo it. 6 screens with over 40 icons in 3 different resolutions and she was very happy with $238.

Cheap or bargain shoppers, yes, these sites are mostly for them but there isn't any site where shoppers will say something like... "yea, I am willing to pay $10,000 for 6 screens with over 40 icons in 3 different resolutions for my iPhone app." That doesn't make sense. We have always been creative in this country and we need to be even more creative now. Find ways to deliver quick and more with more options to consumers. If we complain about the labor or other costs, we fail to understand the free market and global economy. It also means we lost the race.

The designers who complain about 99designs remind me of the record labels. Something you used to charge a lot for, you can no longer charge a lot for. But things aren't going back.

It's the younger designers in school or fresh grads that are building their first portfolio that are being commoditized even more than they already are, which is why I tell them to do pro bono work for non-profits. Designing for non-profits is like programming on open source projects - you can simultaneously gain experience on real work, build your portfolio and give back to a worthy cause.

They'll get more respect and true client interaction than with the minimum wage grunt work on crowdsourced competition sites, even if they pay rent by being a barista until they get their foot in the door somewhere in the industry, like as a low-level production artist at an ad agency.

The company was "Super Bomb Labs" the logo can be seen here:

http://www.superbomblabs.com/images/Topper.png

Hit the nail on the head for me with the combination of the bomb/vial and for $225 the price was dead on.

You can see the whole contest results here: http://99designs.com/logo-design/contests/logo-labs-7824

I know where the complaints come from but I have a hard time justifying paying 5-20x that price to get someone local to do it.

Not trying to be nitty-picky here. You got a GREAT deal. And depending on what your needs are, you're probably fine. I'm just surrounded by pro designers everyday and have analyzed what they do ad nauseum.

The other problem is simply that a logo is but one piece of a big design solution for your entire company. You could, by yourself, fit the rest of your company's design assets around the logo. However, from my experience, without a great designer, you'll probably end up with something pretty spartan or messy. They know what to add and what to remove to the design in different realms (layout, color palette, interaction, etc) to make it have a professional look.

If you only have a logo its kinda hard to build a harmonious design around it but its still better than nothing.

AIGA even have a position on it. http://www.aiga.org/content.cfm/position-spec-work

But I've worked with a fair bit of designers in the 'creative' industry and the good ones could go on 99designs and win close to every competition they entered (barring terrible taste from the submitter).

The lesson is that separating great design from good design isn't subjective (as opposed to some kinds of art) and I've noticed that design is one of those things that only delivers an effective punch when it reaches a certain level of quality. Once it hits that level, it has a disproportionate amount of power to influence potential customers, particularly in spaces that aren't used to great design (b2b products, etc) and the majority of the non-tech public.

That would lead me to believe that, for the long term, it's far better to hire out a reliable, kickass conceptual designer (freelance contract/hire) that can consistently make everything you release look cohesive e.g. e-mails, business cards, website, t-shirts, etc etc. These hires/contacts don't even have to be that expensive: You just need to know where to look and recruit from e.g. NOT Internet boards.

If I was a small startup just looking to gain some traction, I might use 99designs, but with the understanding it was a temporary solution. Because once things get rolling, you're probably going to need a good designer to come in and either redo the brand or try to salvage the existing logo.

From a designers stand point, I notice your startups aren't that great about design and not to say it doesn't work out. Some are really great at design, but I guess the main focus would be function over design, but if both are in play, its great.

Yes you are, but that doesn't have to be a bad thing. It's right for your business at its current stage.

Which is to say that the problem with these spec websites is that they commoditize design (and coding) work in a way which devalues the process behind the trade, which is arguably what you're really paying for.

And say what you will about the quality of the end product, the damage is that people walk away with the idea that design or programming or whatever is not getting there it's about the destination. For a reason why this is a bad idea, look at why people wax poetic about 'thoughtful design' or any of those sites that focus on the details.

It's not that these sites are actually bad and for someone who wants an aesthetic facelift, i'm sure these are often 100% useful, but the utility and the domain of applications where something like 99designs is pretty limited, so i guess you get what you pay for.

Anything that helps get better design out there is fine by me.

Sites like 99designs guarantee a certain number of users will submit entries for your project. While that's a great way to counter the possibility of low quality work, it poses a serious problem for designers (and eventually customers).

In most projects there is only one cash reward. That means if 30 people submit designs, only one gets paid. From a pure efficiency standpoint that means 30x the work is being done. Not only is this wildly inefficient, but it eventually leads to lower quality work overall.

Compare this structure to something like Amazon Mechanical Turk or SETI@home. In most 'crowdsourced' systems each user contributes value to a project by performing a small part of the overall work. There is often a small duplication of efforts to maintain quality and speed when a small number of users produce aberrant or delayed results. But overall the entire project is cut into small pieces and distributed to individuals. That's not the case here. Multiple submissions act as an insurance policy against poor quality work, but the very nature of the system treats that as the norm.

Requiring a dozen or more submissions suggests the management is aware of this issue. Higher quality designers will eventually tire of the much higher workload required to generate returns and migrate to other systems. The longer this system exists the more it will become the home of an unscrupulous breed of designers who simply change text from project to project.

Many 'designers' have a collection of 30 'logos' that are basically clip art that they use for every project. Since the return on their investment is so low it's not worth creating something new for each project. That leads to heavily recycled work and what can (and often does) become little more than a non-automated clip art text replacement tool.

There must be a better system in which creatives can actually divide work instead of duplicating it, and in so doing create a more valuable final product. The same problem exists on sites like Victors and Spoils for advertising

This seems to be a problem that isn't easily solved by market forces: If a new player enters the field, he has to put margins high, because he will only be able to close a small fraction of deals. The only solution would be for someone with sufficient cash reserves to launch a "hard-discount" agency, that would start making money once its market share starts growing.

But how is this different from me having a custom framework I use for most projects? Or a library of code that I can reuse whenever I see the need for it?

Honestly, if I were looking for a cheap logo, "non-automated clip art" from a barely competent designer is better than anything I could put together myself anyway, so I wouldn't be too concerned that it was somewhat derivative of work the designer had done before.

What alternatives would HN recommend over 99designs? We've got our own coders, so need nothing more than an actual design/layout.

That being said, great logo design needn't really be expensive: http://misipile.com has one of the best portfolios I've ever seen, and their rates are not much higher than the 99designs ones.

"For greater certainty, the following are Prohibited Uses and you may not: ... 4. use any of the Content as part of a trade-mark, design-mark, trade-name, business name, service mark, or logo;"

Now since anyone in the world can create and submit work for 99designs (as well as for any other internet / information based agencies) it really levels out the playing field and removes the barrier of immigration when it comes to wages. Meaning that information workers (designers in this case) from developed countries need to add more value to what they are doing than what is available through sites like 99designs, if they want to continue practicing their craft.

http://www.thelogofactory.com/logo_blog/index.php/copied-wor...

(Although I suppose that that risk might not be enough to rank in the top issues a startup has to deal with...)

So yes we are the kind of cheap client a designer would want to avoid at this stage and these services suit it.

I can't see how the system is different to a pyramid scheme. The majority of the participants will see no benefit by submitting an 'entry'.

Crowdsourcing has the potential to be enormously beneficial to society - but the crowdspring / 99design model is unfair.

Just like startups. Or RFPs. With these, the rewards are HUGE so it's worth it to roll the dice. Unfortunately for Western designers, the amount of money regular designers are making on 99Designs IS huge for offshore designers.

For speculative work like spec design, startups, or RFPs it's all about the math-- Cost of Effort * Chance of Winning = Worth it.

In a contest like this, the participants are simply competing for the chance to be paid.

I cannot fathom how this scenario can possibly be fair.

RFP's don't lead to BIG gains either - there are many contracts with a cost plus model. And most startups fail or whither on for years, with no real prospects. That's just how it works - don't like it? Feel free to do something else.

I'm quite happy to be able to state my politics places me at the opposite end of the spectrum to you.

--

"That's just how it works - don't like it? Feel free to do something else."

I'm happy to argue to my case - and to disagree with practices that I feel are unjust or unfair.

Logically and morally - this type of crowd-sourcing involves exploitation. If you carry out work for someone - logically they DO owe you something.

Check out the top designers in the system ( http://blog.99designs.com/tag/top-designers/ ). Note the nationalities and the cost-of-living in those countries. These guys aren't entering hundreds of these contests out of desperation-- they are making a great living. It looks like the good ones are winning 12-20% of the contests they enter.

Perhaps the prize is worth comparatively more in 'developing' countries, but the base argument still stands.

People are competing for the chance to be paid. The vast majority of people will gain nothing.

The majority of effort (cost) expended is provided by the crowd - one person (the contest holder) gets to monopolise on this spread cost, while the majority of the people who take part in the competition end up with no payment or benefit whatsoever.

It's an inconvenient truth - one which many people who use 99designs try to overlook.

You're competing for payment. There's a big difference.

I think expecting participants to be grateful for the opportunity to practice stretches credulity a little.

I hate to break it to you but you as a seller do not get much of a say on what value your product has in the marketplace. This is as true for design as it is for anything else.

The value of a product is exactly what buyers are willing to pay for it. Saying things such as "spec work devalues the entire design industry" suggests clearly that your definition of value is not in line with your customer's definition.

When this is the case, you basically have two options:

1. Demonstrate an increased value to the customer that you bring that they are willing to pay for, or;

2. Lower your price to compete.

Walling off your industry to preserve profits that aren't in line with the real value of the product might be desirable but it is unsustainable in the long run in today's modern world. Ask the music industry.

I upvoted for the rest of the comment, but this bit seemed off. Mainly because the crowd-sourcing idea relies on the respect of copyright even more so than the music industry.

iTunes is a perfect example that given the correct price point, people will pay for music. The big issue is that price point might not be high enough to support the massive marketing and promotion machine that exists. That isn't the consumer's problem though.

In the end, it's actually a perfect example of my point:

When technology reduces the barrier to entry to next to nothing, industries that were predicated on high barriers need to adapt, or they will die. It's a good rule of thumb that the moment you start to do something other than talking to the customer of your service in an effort to preserve revenue, you have a value disconnect with your market.

Basically out of all the people who love music, a large subset of them will pirate it without qualms, and that's all that's really going on here. The changes brought about by the internet have just shrunk the overall industry, rather than allow it to be reshaped by visionary businesspeople or artists. 99 Designs works because due to copyright protection designers feel confident about showing work before receiving payment, meanwhile the music industry is failing because people feel confident about avoiding the legal sanctions of downloading copyrighted material. That it should be like that is just an accident of law enforcement practices and tracibility.

Designers, especially web designers, are working in a highly saturated market. Even in the rural area where I live, I constantly meet designers who want to be in the running for the contracts my firm awards. The low barriers to entry and the seductiveness of the industry have created a situation where many folks are claiming to be designers.

Furthermore, designers are working in a field that requires a unique blend of talents. It's not enough just to be artistically talented and proficient with design tools. The key ability a designer must demonstrate is to be able to, via conversation, grasp the vision that a client has and translate that into a coherent design that provides a fluid user experience.

With so many parties competing for the same business that key ability is the deciding factor as to whether you'll get work or you won't.

If it's my firm and you're new to us, you're going to have to prove that you have the aforementioned key ability. And that means...steady yourself...spec work. Not much, mind you, and not more than is necessary, but enough to prove that you're not just another wannabe with an artistic bent and a Mac.

Don't worry, we're not getting free design work because if we're going use your work, you're getting the gig. If you don't get the gig, it's because your work doesn't cut it.

If that's too much to stomach, no problem. I'll grab the next designer's business card off of an ever-growing stack.

If your looking for something exact I wouldn't recommend, hire one good designer. Its a great startup idea and works well.