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By Purple Fox Legal

July 13, 2022

Social media has become one of the most effective avenues for small business marketing. Not only is almost everyone present on these platforms in one way or another, but they are also incredibly beneficial for increasing brand reach and awareness. And, there are so many different strategies for using social media for business gain. 

In this article, we’re talking about user-generated content. We’ll be discussing this type of content in-depth, and why so many small businesses are choosing to include it in their social media marketing strategy. Then, we’ll focus on the legal risks associated with this type of content, and four practical ways you can minimize them. 

What is User-Generated Content and How is it Used in Small Business Marketing?

Also known as UGC, user-generated content refers to any type of content (text, photos, videos, audio, and reviews) that’s been created by the users of your brand. These users are not official representatives of your business, which makes their content great for building authenticity. Most UGC is used in a small business’ social media marketing strategy and can be helpful for those looking to increase organic engagement. 

Why is User-Generated Content So Popular?

An increasing number of small business owners are recognizing the many benefits of user-generated content and choosing to utilize it in their marketing strategy. The give-and-take relationship between businesses and consumers only grows more popular by the day. Some of the top reasons business owners choose to include UGC in their social media content include:

• Outsourced content creation
• Increased brand advocacy and trust

There’s a reason that nearly 90% of all brands take advantage of user-generated content, and each one is unique to the business itself. 

The Risks Associated with Using UGC in Small Business Marketing

While the use of UGC continues to grow in popularity, it is still a risky way to conduct your marketing strategy. Unfortunately, many business owners don’t realize this until it’s too late. There are many legal hurdles to recognize and work through before including user-generated content on social media. Some of the most important ones are:

• Copyright Infringement

Just because a user uploads content to social media doesn’t mean they’re revoking copyright protections. Business owners should always seek permission from a user before using their content in any way. The risk of copyright infringement is extremely high when utilizing UGC, and business owners should familiarize themselves with the laws surrounding it. 

• Right of Publicity Infringement

Frequently, user-generated content will display individuals within images and video. By using this content for your business, you are commercializing those individuals’ publicity rights. However, you don’t want to do that without permission because violating publicity rights can result in expensive litigation and hefty court judgments. 

Again, business owners should always seek permission from a user before using their content for both copyright and right of publicity purposes. It’s critical to obtain permission from all the individuals displayed within the UGC, not just the person who took the photo or recorded the video. There is an extremely high risk of infringing publicity rights when utilizing UGC, and business owners should familiarize themselves with the laws surrounding it. More information about publicity rights can be found here.

• Privacy Concerns

User-generated content isn’t regulated and can contain lots of identifiable information. The usage of this personal information is regulated by the GDPR and CCPA, both of which impose hefty penalties for misuse of personal information. Privacy concerns should always be considered when taking advantage of user-generated content. 

How to Ensure Your Small Business Gains Content Usage Rights

Small business owners considering user-generated content should embrace transparency when securing rights to utilize a user’s content. This is the first step in protecting yourself legally, and gaining rights over the content. Remember, licensing content is different from owning it, and unless a copyright transfer or assignment occurs, the content creator is the one who owns the copyright.

Additionally, the individuals shown within the content own their respective publicity rights. Using individuals’ publicity rights for a commercial purpose without written permission violates the law. So, it’s critical that entrepreneurs understand the risks and take steps to mitigate them.

Top Ways to Minimize Legal Risks Associated with User-Generated Content

Just because there are legal risks with utilizing UGC in your marketing doesn’t mean the strategy should be overlooked entirely. This approach is incredibly effective and beneficial when used properly. Here are the top four ways small business owners can protect themselves legally. 

1. Use Clear and Comprehensive Language When Asking Permission

Your intentions for the content should be clear, concise, and comprehensive. The users should know exactly how you plan to use their intellectual property. Not only can this minimize the risk of dealing with a disgruntled consumer in the future, but can also address copyright, right of publicity, and privacy concerns. 

2. Gain Permission Before Posting

Make sure that the intended use for the content is approved in writing by each individual whose intellectual property is within the content. It is not enough to obtain permission just from the content creator if other individuals are seen in the content. You must remember that publicity rights are almost always implicated in UGC. It is critical that users actively agree to the terms before you begin posting their content or using it in your marketing campaigns.

3. Include UGC in Your Terms of Use and Privacy Policy

Present clear and comprehensive language regarding UGC in your terms of use and privacy policy. Then, you can add your terms of use and privacy policy to your linktr.ee page and share that link across all social media platforms. Business owners must address privacy concerns when it comes to user-generated content to protect themselves legally. This includes explaining all the ways that you plan to collect, store, use, or share personal and identifiable information. It’s where full transparency comes into play. Make sure to include UGC and content collected via social media in your terms of use and privacy policy to address the types of personal information you intend to collect. 

4. Maintain Updated Records

Complete protection and legal coverage over your user-generated content are only helpful if you maintain your records. You should store and organize written permission to use UGC as well as copies of the applicable UGC, whether it be images, audio, videos, or other formats. Keep your records organized and consider including irrevocable licensing agreements. It’s always best to remain prepared for any legal battle. If you’re considering including UGC as a large part of your social media approach, licensing agreements could be one of the best ways to protect your business. 

Are You Maintaining Legal Compliance in Your Online Marketing Strategy?

Though it seems that utilizing user-generated content is simple and straightforward, it’s easy for things to get complicated. This is especially true if you’re using content from lots of different people and influencers. That’s because navigating copyright law and licensing agreements for hundreds of different people has never been a simple process. Even large-scale companies like Anheuser-Busch find themselves stumbling over this legal obstacle course. This is why protection is required. 

If you’re considering including UGC in your social media approach or marketing campaigns, consider consulting a lawyer. An experienced attorney can help keep your business in compliance and out of the courthouse. They can also be beneficial for keeping your customers satisfied and feeling positive about your brand.