The organisers of the London Olympics have responded to the outcry over their “meaningless” logo by revamping it to carry images of competing athletes.

The clunky, graffiti-style logo for the 2012 Games was criticised for its garish colours, its failure to reflect the character of London, the ideals of the Olympic movement or elite sport.

Now, after a month of protests, designers have devised a less controversial version of the logo. One image, featuring a child taking part in martial arts, is already being used on the side of an Olympics bus touring Britain to promote the Games.

Officials deny that this is a climbdown and claim instead that it is an attempt to “populate” an evolving brand. They will also continue to produce fluorescent pink and Day-Glo orange versions, will retain the shape – which some have likened to a broken swastika – and insist that they will not change it to make the Olympic rings more visible.

However, Lord Coe, the chairman of the London Organising Committee of the Olympic Games (Locog), is understood to have been shocked by the extent of the backlash that followed the launch of the logo last month.

Even teenagers, the intended target audience for the trendy design, have railed against it, according to one insider.

The update of the brand comes as it emerged that the sporting legacy of the Games, crucial to London’s successful bid, may be under threat. Sports that were due to take over the Olympic Park in Stratford, east London, once the Games are over are now refusing to move their headquarters and training facilities because they believe their current bases are more suitable.

The decision could result in expensive venues, such as the Olympic stadium, an aquatics centre and a velodrome failing to meet their potential.

Wolff Olins, a brand consultant, was awarded a £400,000 contract to produce the 2012 logo even though it was not required to submit preliminary images to Locog.

The logo, which was launched in four core colours (pink, orange, green and electric blue), was met with derision by the public, with almost 50,000 people signing an online petition calling for it to be scrapped.

Although the logo will be shown in 3-D in films and on the internet, it is believed that 2012 officials failed to take into account that most people would see it only as a flat image in newspapers and magazines.

"It's all very well saying that it works in its full 3-D glory, but in fact most of the time it's a flat image," said the source.

A Locog spokesman said sponsors will be allowed to choose their own colours and images to fill the “2012” outline, with Lloyds TSB, the official banking partner of the Games, opting for its corporate green and blue.

“What we always intended to do – and we are doing it sooner now than we thought – is taking the marque and infilling it with pictures, with photographs, images of sport and children,” said the spokesman.

“It’s not a U-turn...it’s moving the brand forward and evolving the brand in a way that we always said we would do.”

Coe will update the International Olympic Committee with London’s progress in Guatemala this week, where the organisation meets to decide who will hold the 2014 Winter Olympics.

Concerns about the sporting legacy of the Games have surfaced after the governing bodies of five disciplines – athletics, swimming, cycling, hockey and tennis – recently told the British Olympic Association that they no longer wanted to move their national squads to Stratford.

This undermines a promise made by Coe to the International Olympic Committee and jeopardises the creation of an elite centre for sport at the Olympic Park to make use of venues once the Games are over. The area is now likely to be used for regional training when not hosting competitions.