With avatars and favicons, your logo is being pushed into a box. For whatever reason, the standard for these items seems to be a square shape.
A favicon is the little icon that sits just to the left of the URL address in your web browser. On this page it’s the Visible Logic monogram inside a green square. Favicons (short for “favorites icon” because it appears with your bookmarks or favorites) is always created as a 16 pixel x 16 pixel graphic. Very small, very little data, and definitely square.
An avatar is the graphic that represents you (or your company or brand) in places such as blog comments, forums, etc. You could even consider your Facebook profile photo an avatar. Notice, again, how they are all square. There is variation in size, based on the requirements of each web site, but I’ve yet to see a default avatar that is anything but square.
There was a time when graphic designers felt there was almost a sacred space around a logo. Identity standards were created and distributed. These manuals were filled with rules regarding how much white space should surround a logo, and harsh warnings about never cropping or otherwise altering a logo.
There are still many valid reasons for protecting your identity and keeping it consistent. But you also need to realize that you’ll need a square version of your logo. And it should reproduce well at small sizes.
I feel rather lucky with my logo. It was designed before favicons or avatars were widespread. But my thought process was always that I wanted to have logic in my design. So the monogram is the same height and width.
I haven’t always used my monogram within a box, but it’s a version I’ve used more and more lately because it has a bolder presence, and quite frankly because it does translate well into all these formats. Because it works in those formats, I build consistency whether or not I’m in an environment that requires a square.
I don’t think it makes sense to design every identity with a square template. If we all did that, there’d be a definite lack of diversity in corporate identity.
However, you should develop a version of your logo that is used whenever a square format is requested. This could be done by cropping the logo, or rearranging the parts. Ideally you should have one version that is used whenever you are faced with this challenge. The favicon has its own very special limitation because it’s square and extremely small, so readability becomes a factor. But for all other applications having a consistent square version will help maintain consistency in branding.
Once you have this version protect and distribute like the logo itself. Protect it from being changed by countless people, but distribute it so it’s used consistently.