Online business, Terms of use
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How lawyers’ terms for your WordPress business can affect your revenue

WebTermsRevenue

So you’re starting an online business

You’re starting a WordPress-related business of some sort. You need website terms of use or a privacy policy or software-as-a-service terms for the site. You ask your lawyer to whip something up so that that particular box can be ticked off: “Terms of use, done”. You might be someone who works closely with your lawyer on such issues or you may give your lawyer comparatively free reign. Does it matter? I suggest it does, as I’ll try to show in this post.

Three “stories”, if you like, have prompted me to write this post:

I’ll tell the three stories shortly but the point of this post is that the the manner in which lawyers (or others) draft terms of use and other legal terms for their clients’ online businesses can have a significant impact on customers’ perception of the business and potentially the business’s bottom line. I appreciate that this issue isn’t limited to WordPress-related activity but, due to the growing number of WordPress-related businesses, I thought I’d touch on it here.

The Pinterest story

Back in early 2012, a storm whipped up regarding some terms in Pinterest’s Terms of Use. One of the terms that was rattling users was a term that said, by posting content to Pinterest, users were granting Pinterest the right to sell their content. Here is the legal wording used at the time (you can find early versions of the Pinterest terms in the Web Archive):

“By making available any Member Content through the Site, Application or Services, you hereby grant to Cold Brew Labs a worldwide, irrevocable, perpetual, non-exclusive, transferable, royalty-free license, with the right to sublicense, to use, copy, adapt, modify, distribute, license, sell, transfer, publicly display, publicly perform, transmit, stream, broadcast, access, view, and otherwise exploit such Member Content only on, through or by means of the Site, Application or Services.”

Now, when Pinterest sent an email to users announcing that it was updating its terms of use, it said (among other things):

“When we first launched Pinterest, we used a standard set of Terms. We think that the updated Terms of Service, Acceptable Use Policy and Privacy Policy are easier to understand and better reflect the direction our company is headed in the future.”

On the “right to sell content” point, the email said:

“Our original Terms stated that by posting content to Pinterest you grant Pinterest the right … to sell your content. Selling was never our intention and we removed from our updated Terms.”

(The full text of the email has been reproduced online.)

At the time, the references to “standard set of terms” and selling never having been Pinterest’s intention made me wonder about what went into the drafting of the terms. The drafting was belts and braces wording commonly seen in online terms which, I suspect but don’t know, was either drafted to protect Pinterest’s interests and potential future interests to the greatest extent possible or was a template provision used in the terms without analysis of how it might affect users’ perception of the service. But here’s the thing: whilst we need to be careful about judging with the benefit of hindsight, including a right to sell members’ copyright content was probably never going to be pretty because with potentially popular platforms like Pinterest you’re always likely to find a small number of users that comb through the terms and report publicly on things they consider to be extreme. That sort of thing happens on government websites too: include something that people find inappropriate and don’t be surprised if you receive a complaint.

My client feedback story

Some time ago now, I prepared a privacy policy (among other things) for a client (I won’t name the nature or sector of the client sorry). I addressed all the things the policy needed to address, I used what I thought was approachable language and I made sure that I covered (among other things) all potential collections of personal information and potential uses of that personal information, so as to ensure compliance with applicable privacy law. But the client didn’t like it: it was too long and the way I’d described the collections and potential uses were, it thought, too detailed and might have been perceived in an alarming way by users when there wasn’t reason to be concerned.

The very same day (evening in fact) I rewrote it from scratch (for no extra charge). It wasn’t difficult, as all the legal analysis was there, but I managed to shorten it considerably, remove some terminology that didn’t really need to be there and made all the points that needed to be made but without the same amount of detail. The end result was punchier, friendlier and easier to read. What was it again that Benjamin Franklin is said to have said?

“I have already made this paper too long, for which I must crave pardon, not having now time to make it shorter.”

The Envato Studio terms story

In a previous post, I spoke positively about the drafting of Envato Studio’s legal terms, in the context of reviewing the intellectual property terms of four WordPress and other ‘job shops’. I’d read the Envato Studio terms after analysing and writing about the terms of the other three services. The clarity I saw in the Envato terms, in terms of their language, their coverage of the important points, their structure and their visual layout was refreshing. I even went so far as to assert that whoever drafted the terms was worth every cent Envato was paying them.

What these stories tell us

I chose these three stories because, taken together, they illustrate the importance of taking care in drafting online terms of use, privacy policies and similar terms. Lawyers are, of course, trained to take care, to look after their clients’ interests, but the key points I would make are these:

  • Clients’ interests are not necessarily best served by including every possible protection, benefit or interest. What goes in and what stays out needs to be discussed but it’s vital to take into account the impact that certain inclusions or exclusions may have on customers’ perceptions of the business and the respect (or otherwise) that the service provider has for their interests. This can be a tricky balancing act at times but getting it wrong runs the risks of inciting adverse publicity, losing customers and adversely affecting the service provider’s revenue.
  • If you get the terms ‘wrong’ and there’s a resulting outcry, fixing them and being human about it – as Pinterest did – is probably a good idea.
  • Drafting approachable, plain English and user-friendly terms is both a skill and an art. The lawyer needs to make sure that essential points are covered while also sounding as human as possible and not freaking out the client’s customers. This may require refinement upon refinement but is well worth it (and you’ll feel better when you’ve done it).

In a competitive market, user-friendly terms that cover relevant bases appropriately may be one of a number of factors that send at least some customers to one service provider as opposed to another. It is true, of course, that many people don’t read terms of use, but those whose commercial interests are stake (e.g., a WordPress business commissioning a WordPress theme or plugin for resale) should read them and certainly some of them do.

Happy drafting.

(Featured image: Igor Stevanovic / Bigstock.com)

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