Operating an ecommerce platform creates plenty of opportunities but it
also comes with legal responsibilities. Businesses are familiar that operating a
bricks-and-mortar site comes with legal obligations but often forget that
similar obligations apply in the online environment. Whether you're trying to
maintain your reputation, introduce a friction free returns process, manage
your cash flow or reduce your liabilities, this video provides some top
tips on avoiding some of the common ecommerce pitfalls we see.
The law requires you to have certain provisions included within your terms
and conditions of sale. If you don't do this
customers can return - with very few exceptions - the goods that they purchase
for up to 54 weeks from the date of purchase. This can have a huge negative
impact on your cost flow. Whilst it's a huge risk it can be easily avoided by
making sure that your terms and conditions properly address the issue. Be
careful also with stock control, how you dispatch goods and when you take payment.
Taking payments for goods that you're not yet ready to dispatch can create
major headaches for the business particularly if the customer later tries
to cancel their order.
Remember that when a customer buys from you in the online environment, handing over their cash,
they're taking a leap of faith. The law requires you as a business to put
certain mechanisms in place to reinforce that faith, much of this needs to be
dealt with in your terms and conditions. Your terms and conditions
need to be clear, as concise as possible and free of jargon - remember though that
there are certain provisions which you are legally required to deal with. Your
terms should be a tool helping to make the customers journey as smooth as
possible, don't bury them at the bottom of the site - be proud of them, put them in your own voice
so that they mirror the rest of the site. Don't be afraid to use summary sheets either.
Be transparent on returns. Customers like to see your returns policy set out in a
separate document, so if you can provide this. The law also requires you to use
cancellation forms and to clearly communicate how the returns process
works, this should be communicated both in your terms but also in the emails you
send your customers as part of the order process. Remember that if you want the
customer to pay for the return costs of non faulty items you should set this
out at the beginning, and don't forget that in the online environment consumers
can return goods even when they're not faulty, with very few exceptions, just
because they've changed their mind.
You must have good processes in place to communicate with your consumers through
every step of the journey. Much of this can be automated in the use of emails or
designated account areas are a common way to do this. You should tell them when
you're taking payments, when you're shipping goods, you should communicate a
cancellation form and your returns policy - make sure that they can, at a
glance and very easily, find all the information they need to identify who
they're dealing with, their rights if things go wrong, how much they're going
to pay and when they're going to receive the goods.
GDPR and data protection have a huge impacts on ecommerce businesses. Their
impact is far-reaching covering things such as cookies, your choice of courier,
your choice of payment gateway and so on. Getting it right can have a huge benefit
for the business enabling you to use exciting analytic tools, getting it wrong
can be disastrous especially as the consumers become more and more aware of
their rights. Compliance can be quite time-consuming you'll need to do a
mapping exercise, understand where your data flows to and all the third parties
that have access to it. Doing this once and getting it right can help in the
long run make sure that you can use GDPR as a tool rather than seeing it as just
a regulatory hurdle to jump over.
It is easy to use your ecommerce platform to target consumers over
seas but before you do so make sure you do your research and have your eyes open
to the risks and responsibilities, as well as the opportunities - for example by
making small amendments to your website, changing for example the currencies that
you accept you may find yourself opening yourselves up to liability to laws in
other territories. Be aware also that you could find yourself falling foul of
intellectual property laws, for example you may be shipping a product which has
a brand which is fine in the UK but if that brand is registered overseas and
you ship to those territories you could be committing an intellectual property
infringement. Make sure you do your research, understand the laws in the
territories that you want to ship to and take advantage of the opportunities
while staying on the right side of the law.
When running a bricks-and-mortar site you'd have various obligations to your
customers, think for example of your obligations to look after their physical
safety whilst they're on your premises. You'd also expect the customers to
follow certain rules whilst on your premises and it's no different on an
ecommerce site, on an ecommerce site the easiest way to set out the ground
rules on which a consumer can visit the site is to set them out in what's
called website terms conditions of use. Such a document applies regardless of
whether the customer buys anything from the site and simply says what they can
and cannot do whilst at the site. Well drafted website terms of use will
also help you to comply with a number of your legal obligations, for example
making it clear to the customer who they're dealing with.
Website terms and conditions of use can be really helpful in stopping people
from committing copyright infringements, linking to your site when you don't want
to or using your site for other nefarious purposes.
Software code, content and images on your website will most likely be
protected by copyright. Copyright is a right which does what it says on the tin
it enables the owner to stop copying. The owner is likely to be the person that
put pen to paper, the software developer, the marketing company, the photographer,
the person that created the work. If you want to own the copyright, and you
should to make sure that you have control over it and the flexibility to
use it commercially as you wish, you need to put in place an IP assignment with
the person that created it. Make sure also that you don't inadvertently
infringe third party intellectual property, doing so can land you in hot
water. Just because images or text are readily available online to
right-click, copy, paste, doesn't mean that you should do it, doing so is still a
copyright infringement where you don't have the copyright owner's consent. This
even applies to product images. Make sure to have differentiated the site, and to
reduce the risk of copyright infringement, you take your own images of
products that you're going to sell.
Many businesses fail to protect their reputation
by registering their trade mark. Many businesses believe mistakenly that they
don't need to do this thinking instead that they're covered by domain name
registrations, company name registrations or trading history. Only a trade mark
registration gives a government endorsed monopoly which enables you to
stop other people from using an identical or similar marking respective
identical or similar goods and services. Consider getting your trade mark
registered as soon as possible to help you manage your reputation both online and offline.
Your web content and social media posts are all forms of marketing and as such
need to comply with the rules on marketing, for example if you're making
statements about your business or products or services you need to make
sure that those are open, honest and transparent. If you're making comparisons
between your business and another you need to make sure these are fair,
in compliance with the rules and don't fall foul of any trade mark legislation. If
you're making objective statements which can be assessed you need to make sure
you have the evidence to back them up, for example if you're saying that
product X is your most popular line you need to have the evidence
to statistically prove this. With your social media posts be careful to make it
clear that if there's a commercial connection between the person making the
post and the post this is made clear, for example a business owner posting about
how great their business is could soon come into hot water if they don't make
it clear that they are the business owner. Hopefully this video has helped
you to understand how online compliance can help you stay on the right side of
the law, add a competitive edge and reduce your risk. Our expert team
understand both the law and the web so if you'd like more help please get in
touch. If you'd like more information on similar topics please subscribe below.