Why you don't need a logo and can get by with just a favicon

Hang around in any community about web design and you will stumble on a post asking for advice on how to get a nice looking logo on the cheap. I always answer with "you don't need one, spend your money on something that really matters" and then watch my comment down voted into oblivion. Let's see if it helps when I put my reasoning behind it.

Why do you think you need a logo?

It is probably because it is conventional wisdom and it has its roots in traditional publishing. Imagine you are in the business of selling deadwood by printing somewhat actual news on it, this is where your product is presented to your customers:

 

Not too much opportunity to make an impression on an impulse buyer... You have to distinguish yourself from others with a few basic clues: monochromatic serif fonts suggests that your are a serious paper.  More colours and sans-serif tell that your paper is more of a light reading material. A website's equivalent of news stand is a SERP or a social bookmarking site. You don't get to choose how you look in these anyway.

Why most websites don't need a logo?

Because conventional wisdom is not always right. It tells you to have your website in flash if you are a restaurant owner, have music playing in the background if a photographer. Conventional wisdom on website logo is wrong because:

1. Visitors don't get to see your logo until they are actually on your site. The exception to this is websites who draw their traffic using widgets.
2. Once a visitor is on your site you have better tools to increase your  metrics. Remember that F shaped heat map? You have to use every bit of that to increase your page views, retention or whatever the metric you care. Wasting that space with a logo is the last thing you want to do.
3. A logo is a brand recognition tool. You don't do brand recognition. If your traffic building strategy is not to put your logo in front of millions of eye balls and expect to be recognized on supermarket shelves, you can pass investing in a logo.

Why you need a good favicon? 

Your websites news stand moment is when a visitor opens multiple tabs on a SERP. If you can get the visitor to click on your tab ahead of others, that's  a bonus. A distinguishable favicon might give you the edge here. However return on investment can still be very low for this scenario.

You will probably not listen to some random guy on internet and ditch your logo. But do yourself a favour and run some A/B tests to see if it really matters before you spend any money on a new logo.