This is the digital age. We are acquiring fewer and fewer physical products and instead are streaming, downloading and subscribing to services over the internet. Selling content online is not only approaching a responsive market but it’s accessible for so many more entrepreneurs. With minimum overheads, low set-up costs and no manufacturing, online content providers are not all big businesses. Many are solo entrepreneurs, small businesses and self-employed parents. Yet, online content is still valuable and it needs to be protected. In this article, I will answer some of the most common legal questions regarding selling content online and explain just what needs to be in your Online Sales T&Cs to protect your digital products.
What Digital Products Can Be Sold Online?
First, let’s look at examples of the digital products you might be selling. Online content could include:
● Online courses and course materials
● Memberships (communities, reward schemes, networking groups, etc)
● Subscriptions (podcasts, film, tv, software, etc)
● Data and research
● eBooks
● Digital templates (business, legal, design, website templates, etc)
● Recipes
● Music, art, software, photography Whilst subscriptions may be relatively low-cost on a monthly basis, building up your subscribers could make for a very lucrative business, as can membership services. If you’re doing this, you should check out our Legal Guide To Setting Up Online Community And Membership Platforms. Digital products are usually one-off sales. However, selling content online gives you a huge advantage that physical shops don’t have - the power to reach out to former customers, usually via email, to let them know about related or new online content they might be interested in. You can only do this though through collecting data, so you need to ensure you’re compliant with GDPR and transparent in your terms and conditions/privacy policy. You’ll also need to learn about intellectual property when selling content online, as well as consumer rights. Much of this, you will come across as you draft, or when a commercial solicitor prepares, your Online Sales T&Cs for selling content online. What Should Be Included In Terms And Conditions For Digital Products And Selling Content Online? I would highly recommend hiring a commercial lawyer to write your terms and conditions. It’s a vital and complex contract that becomes very important if you ever find yourself in a dispute. The agreements made between your business and your customers through the terms of sale, or terms and conditions, can work to protect your business. However, contracts that are not ambiguous or not deemed to be fair and reasonable may be dismissed in a legal dispute.
Here is what your terms and conditions should include:
Consumer Requirements For Individuals Purchasing
Referring to the transparency of sale, you need to include in your terms and conditions information about the business. This should include:
● Who you are (trading or limited company name)
● Your trading/limited company address,
● How people can contact you,
● Whether you are regulated (and if so, who by)
● Your VAT number
● Description of the goods/services being sold and the price
The Gov.uk website has more detailed information about the pre-contract information requirements that businesses must display on their website or in their Online Sales T&Cs before the consumer pays their money.
Cancellation Rights (and when they don’t apply)
Under the Consumer Rights Act, businesses selling products to customers must comply with a 14-day cooling-off period, during which the customer may cancel and receive a refund. However, when selling content online this becomes a little more complex. The right is waived in regard to downloadable content. When the download is started the customer loses their cancellation rights and they should be made aware of this before buying.
If goods are found to be faulty or not as described at the point of sale, however, the consumer has a right to cancel and receive a refund even if they have downloaded, or attempted to download the product.
It’s worth noting that these same rights do not always apply when selling to businesses so if you’re selling B2B then you may need separate terms and conditions or need to specify different terms in your contract depending on whether the purchaser is a business or consumer.
In your terms and conditions, you should also set out what the cancellation process is, especially for subscription or membership customers.
How Customers Can Complete Their Order
When selling a digital product online you need to describe the order process - what will happen after payment. It will likely involve order confirmation and then download instructions for accessing the content. In your terms and conditions you need to explain the process. This may involve downloading something or awaiting an email with a login or other way of accessing the digital product.
This is something you would of course include elsewhere in your communications with your customer. They shouldn’t be expected to read through your terms and conditions. However, it needs to be included here to enforce expectations were there to be an issue with order completion that leads to a dispute.
Price
You must be transparent on your pricing and what this includes, as well as whether it is a one-off payment or a monthly/weekly fee, and whether VAT is included.
Description Of The Content
You needn’t describe the content you are selling within your terms and conditions but you should refer purchasers to a page on your website where they can find this. On this page, there should be an accurate description of your digital product. It is even more important with digital products and content that buyers know what to expect because they often won’t have full access to the file/software/content until they have made payment. Dealing with claims that the online content is not as described will be time-consuming and will negatively impact your brand and reputation, so be transparent.
Intellectual Property
You should retain ownership of all of your intellectual property. Not doing so would drastically reduce or even eliminate the value of your work. This is protected under copyright law. However, it should also be backed up in your terms and conditions when selling content online.
When selling digital products, digital downloads and other digital materials, you are licensing these to the customer, not transferring ownership, and you need to formalise this within your terms and conditions.
To learn more, read through the 5 Things Every Small Business Should Know About Copyright
Data Protection
Data protection is very important for selling content online because you have to collect customer data at the point of sale. Therefore, you have to be legally compliant. You should have a separate privacy policy available on your website that details how you collect, store and use data and this should be adhered to in practice. Within your terms and conditions, you don’t need to regurgitate your data protection processes, you only need to link to your privacy policy so that the customer has access to read through this.
Need a privacy policy for your business? Get in touch and I’ll talk you through what you need and how I might be able to help.
Should I Use A Template For Online Sales Terms And Conditions?
Many legal templates work well, especially for small businesses. However, even with a template it is worth having a lawyer check it over and ensure that it has been adapted to meet your particular requirements. Also, you’ll want to establish that it is from a reputable source because this is a document that needs to be able to stand up to scrutiny. As an online content provider yourself, you will probably already know that free and very cheap downloads are risky. Quality online content has value and that means it comes at a cost, even if it’s a reasonably priced one.
If you are approaching a lawyer to draft terms and conditions for selling content online then ensure this is something they specialise in. You’ll need a commercial lawyer, like myself, and you may find that you can save money and time by having them handle an e-commerce legal package for you which would include your terms and conditions, plus more.
As a commercial lawyer working with e-commerce businesses, I have recently developed a couple of templates specifically for businesses that are selling online courses or workshops.
First up, is my Online T&Cs for Online Courses and Workshops which can be used when selling online courses/workshops as a one-off purchase. These T&C have been written in plain language, are user friendly and will be easy for your customers to review and navigate (whilst also protecting your business!).
A lot of online course creators are often asked by businesses to create bespoke courses and workshops which can be delivered online or in real life (face-to-face). If you are approached by a business client with this request, then I have developed a special Workshop Services Agreement which is a legal agreement that is agreed offline with your client for the provision of online or offline courses/workshops (that’s not confusing at all – is it?!).
Get in touch to learn more about how I can help your e-commerce business with the legal aspects of selling content online.