Unzip the folder and copy the file inside to your appdata folder and locate "Manor Lord" folder.
Your Drive: \User\[Username]\AppData\Local\ManorLords\Saved\SaveGames (you might want to view your "AppData" folder as it is hidden by default).
and place "custom_coat.png" in that location.

Important:
When choosing a new game, click "Load a custom texture" button beneath Coat of Arms to change to your custom coat of arms.
This is next to "Load coat of arms" and "Save coat of arms".