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It’s no secret that the digital product world is absolutely booming and everywhere you look there’s someone else selling something new online.
And as someone that sells digital products myself, I get the hype.
Whether you're a stay at home mom that wants to make some extra income for your family or someone that’s trying to ditch your corporate career, digital products can be a GREAT way to make all of those things happen and live your best life.
But where digital product sales start to go wrong is when you don’t have your online shop legally backed.
That’s when some real scaries can start to happen, which is why I always preach about having certain contracts and legal agreements in place for your business so you can avoid all of that nonsense!
But beyond knowing what legal agreements to have in place, you might be left wondering, “okay… but how exactly do these protect me?”
And that’s a great question! I also like to know how something works and the full reason behind it before implementing something in my business.
If you’re the type that just wants the simple and straightforward steps to protect your online shop, click here for the 3 Legal Agreements Your Online Shop Needs!
But if you’re the type that wants to understand the clauses that are involved, I’ve got you. 👇🏼
5 Hardest Working Clauses in Your Terms of Purchase
One of the most important legal agreements for your online shop is a Terms of Purchase that sets the rules for how your product can be used.
Not only does a Terms of Purchase cover how someone can use the product they purchase, but it also covers policies that are a part of the purchase process, such as refunds, chargebacks or cancellations.
This type of agreement is often referred to as “Terms and Conditions” and you’ve likely seen these in action during your own purchases with various businesses.
Most businesses have the “I agree to these Terms and Conditions…” checkbox at checkout, which means that you’re actively agreeing to the terms the business has set up.
That little checkbox that you might be familiar with is called a “clickwrap” in the legal world and is the exact way that I advise business owners to display their terms.
When you set your terms as a clickwrap (NOT a browsewrap), your agreements are more enforceable if any legal action is ever needed!
When it comes to implementing Terms of Purchase for your online business, you want to make sure you’re including all of the applicable clauses to fully protect yourself, including 5 of the top hardest working ones:
A license to use clause is like renting a car – you don’t OWN the car, but you have the right to use it for a specific period and under certain conditions. You can drive it, but you can't sell it, repaint it, or make major modifications to it because you're only renting it.
The same goes for the products that you sell in your business. People aren’t buying the intellectual property of the product that gives them the right to do whatever they want with it.
Instead, they’re getting PERMISSION to use it in a certain way and with certain restrictions.
That’s what your license to use clause is for! This clause in your Terms of Purchase agreement specifies the terms and conditions of which a customer is granted the right to use certain intellectual property, software, or other assets that are being sold or transferred as part of the purchase.
The clause typically outlines the scope of the license being granted and clearly defines what rights the customer has to use, install, modify, or even distribute the product, depending on the terms negotiated.
If there are any restrictions involved, this clause lays those out very clearly as well, along with specifying the duration or term of the license.
Online business owners who sell digital products are the most at risk to be struck by the copycats in the world. 😾
It’s so easy for someone to buy your digital product, create their own version of it, and re-sell it for their own financial gain.
As wrong as this is, it happens way more than you think and if you want to fully protect yourself against this insanity, an intellectual property (IP) clause in your Terms of Purchase agreement is a MUST!
This clause plays a crucial role in defining the ownership, rights, and responsibilities related to intellectual property assets involved in the purchase.
This includes patents, copyrights, trademarks, trade secrets, and other forms of intangible assets.
This clause helps protect the interests of BOTH, the buyer and the seller, by addressing various aspects of intellectual property within the context of the purchase agreement.
Ultimately, intellectual property is THE clause that can help legally protect you in the event that someone unfortunately steals your work and tries to rip it off for their own benefit.
The phrase that no business owner wants to hear… “Can I get a refund?”
To avoid the annoyance of refund requests with your digital products, you want to include a refund clause in your Terms of Purchase agreement, which outlines the conditions and procedures of which a customer may be entitled to a refund or reimbursement for the product they bought.
The role of a refund clause is to establish a CLEAR framework for addressing situations where the customer may be dissatisfied with their purchase or where certain conditions have not been met.
Having this clause set up in the beginning allows you to properly respond to these unwanted requests and have a tried and true system that you can fall back on, instead of having to navigate each scenario separately.
You’ve heard of refunds, but have you heard of chargebacks?
These sneaky little things are way more common than many business owners realize and they actually cost businesses up to $150 BILLION per year. 🤯
Chargebacks are basically the concept of someone buying your product, using it, benefiting from it, and THEN asking their bank to take their money back and return it to their account…
Sounds a little illegal right?!
Well, it’s not – just morally wrong, but trust me, that doesn’t stop people from doing it!
I have a whole spiel on chargebacks here so you can fully understand how they work and how they differ from refunds, but the most important thing I want you to know is how to avoid them altogether.
Having a chargeback clause in your Terms of Purchase agreement will establish the conditions under which a customer can initiate a chargeback, while also defining what a chargeback is within the context of the agreement.
In the unfortunate instance that a chargeback is initiated, the clause should also describe the process for how the dispute will be investigated and should detail the resolution, which may include a refund to the buyer or a correction of the issue.
You know when you’re playing Monopoly and you know EXACTLY how to get your player out of jail because it’s been defined by the rules of the game?
That’s what a dispute resolution clause in your Terms of Purchase agreement is like!
This clause serves the critical role of outlining the procedures that the parties involved in the agreement will follow to resolve any disputes that may arise during the course of the business relationship.
This clause helps to mitigate potential conflicts, establish clear guidelines for dispute resolution, and often encourages parties to resolve disputes amicably and efficiently.
Having this clause set up from the very beginning and defining the dispute resolution for your specific business allows you to respond confidently and know the exact steps to take when unfortunate scenarios arise.
How To Easily Implement Terms of Purchase For Your Digital Products
Now that you know which clauses work the hardest in your Terms of Purchase Agreement, it’s time to actually implement them.
You *could* spend hours of your precious time googling how to craft the perfect clause OR you could let The Boutique Lawyer do it for ya!
Our Terms of Purchase for Digital Products contract template, includes ALL of the hard working clauses listed above and MUCH more, so all you have to do is plug and play to add your specific business details, add it to your website, and you’re legally protected just like that!
And if you’re in need of other legal contracts to make sure your business is covered from top to bottom, click here to browse the shop and grab what you need!
If you’re in the online business space, you’ve inevitably heard the term ‘passive income’ a time or two.
Business owners love to preach the power of passive income and talk about all of the ways you can make money without having to lift a finger.
And as a business owner myself, I get it – passive income does sound really nice and there are a LOT of ways that you can earn it.
But where this whole idea starts to go awry is when you're making lots of passive income with no legalities in place to back you up.
Because yes, making passive income is completely legitimate and can be a great addition to your monthly revenue, but it doesn’t do you much good if you’re just going to have to pay it all back later.
And unfortunately, THAT scenario is what can happen if you skip out on 3 key legal agreements to protect your affiliate income.
In this blog post, we’re diving into this scenario specifically for those who use their blog to earn affiliate income.
So, if you’re a blogger, influencer, or business owner who actively utilizes your blog to link products and offer affiliate codes, THIS is for you!
How To Legally Protect Your Affiliate Income So You KEEP What You Earn
It seems like everywhere you look these days, someone on Instagram or TikTok is saying “use code XYZ for 15% off” and to you that might just seem like a sweet deal to take some extra money off your purchase, but to them it often means extra cash in their bank account.
And there’s nothing wrong with this and the cool part is that almost ANYONE can be an affiliate of something.
Aside from being an affiliate for product itself, there are also so many platforms out there that offer affiliate codes when you join and most of these platforms are what business owners are commonly using, such as FloDesk or Honeybook for example.
With this influx of affiliate marketing, SO many people are using this as an opportunity to earn extra money without really having to do any extra work.
And let me just be clear – I’m here for it! I have an affiliate program for The Boutique Lawyer contracts that people can be a part of AND I’m an active affiliate for other programs out there.
But what I’m NOT here for is when people don’t disclaim their affiliate use and even more so when they don’t protect their potential earnings.
If you are an affiliate of ANY kind and promote other products and services through your blog, email, or social media accounts, you must first let people know that you can potentially earn money through their purchases, and second have certain legal agreements in place so you can keep that earned income.
The legal agreements in question include:
If you’re selling products or services, tracking your website visitors with cookies, using affiliate marketing or even collecting email addresses, a privacy policy is a REQUIREMENT for your website!
And it’s not just to protect your customer or website visitor – it’s also to protect YOU as the business owner.
Although the term “privacy policy” might sound like some scary legal jargon, I promise you it’s really not that complicated.
A privacy policy is simply a detailed notice that is published on a website, typically found in the footer, that outlines how that specific website collects, uses and manages a user’s personal information.
Essentially, this policy lets people know what personal information is collected, how that info is collected, how it’s used, and, most importantly, how it’s protected.
A Terms of Use agreement is a legally binding agreement between you and ALL of your website visitors that typically covers topics like if or how they can use your website images (including your logo), how they can backlink to your website and even how they can quote your blogs.
Similar to your Privacy Policy, your Terms of Use Agreement should be displayed in the footer of your site so that it populates on every single page.
Without a Terms of Use Agreement on your website, you run the risk of people stealing your content or misusing your website and you’re left with no legal leg to stand on.
This is a SUPER common issue for those in the blogging and influencing space, so take the necessary steps to protect yourself and avoid yet another legal headache.
A general disclaimer is important for ALL business owners, but if you’re involved with affiliate marketing and have the potential to earn income through certain links and codes, this one is a nonnegotiable.
If your website includes ANY affiliate links, you’re required to have a General Disclaimer that can be linked in the footer of your website along with your Privacy Policy and Terms of Use.
The main purpose of this disclaimer is to provide transparency and disclosure to your audience by letting them know that you can potentially earn commission from links throughout your site.
In addition to your General Disclaimer, you also want to make sure that you are disclaiming your affiliate links in ALL of your blog posts, Instagram stories, and social media posts.
While this technically isn’t a structured legal policy, it IS a simple statement that can save you from legal trouble in the future.
Failing to disclaim affiliate links, sponsored collabs and even gifted promotions, can land you in a lawsuit real quick and is one of the 4 most common legal mistakes that I see ALL business owners making.
For blog and social posts, you can say something as simple as this:
“P.S. This blog post contains affiliate links, but I only ever recommend products or services that I love and use myself!”
How To Legally Protect Your Affiliate Income With Ease
So, if you’re a blogger, influencer, or simply a business owner who has the chance to earn affiliate income, consider this your green light to GO FOR IT with certain legal agreements in place!
Implementing each of these into your business can be the thing that protects you from having to pay any affiliate income you earn back.
Because yes, the Federal Trade Commission (FTC) checks for these things and the worse case scenario is that you could get sued. 😅
And just take it from someone who has had a front row seat to a lot of lawsuits… you don’t want that headache.
So go ahead and do the simple and smart thing NOW to avoid any of that craziness later!
In The Boutique Lawyer Contract Shop, you’ll find everything you need to implement as soon as today and you can purchase each contract individually OR grab a bundle that has everything you need wrapped into one.
For bloggers, influencers, or business owners earning affiliate income, I’d recommend The Blog Protection Bundle, which includes the 3 things mentioned above so that you can get all of your legal ducks in a row with ease!
P.S. If you’re a business owner that wants to implement an affiliate program in your business, CLICK HERE to learn more about the ins and outs of affiliate marketing and discover the 2 contracts you need specifically!
