Before we get too involved with finding all the different ways there is to make money online, we have to learn to do it the right… and legal way. You can’t just promise people the world and not be able to deliver it. Many people have the mistaken impression that the internet is a totally unregulated medium where anyone can do what they want, and therefore a certain distrust is born, preventing some from feeling the freedom to use it as they would like to.

Internet legalities are real!

The reality is that there ARE laws governing the use of the internet, particularly in the realm of ecommerce.The FTC and other government agencies are very watchful of what goes on there, and they will come down on those who don’t abide by the laws!

As a small business operator, you might wonder how a person stays on top of such information, so that you know what can and can’t be done. The simple answer is trade magazines, such as mThink, a marketing magazine geared toward affiliate marketing.

An article in today’s issue caught my attention in regard to what is happening in the area of legal issues with web sites, and it should be required reading for anyone thinking about owning an online business. It isn’t just fun and games in the online world, Running a business means paying attention to ALL aspects of running a business, the same as in the real world.

Too many in this business think that just because they don’t have a phycial property, where someone can trip and fall, and subsequently sue them, that they don’t have to worry about liability. The truth is that there are as many legal issues to deal with here as anywhere else. The fact that the minor infringements may be smaller than a physical business is overshadowed by the fact that you aren’t just dealing with local customers. You may likely be selling to the entire world, and therefore, there is more likely a chance of someone noticing one of those small indiscretions and call your bluff on it!

Examples of internet legal issues for web site owners might be…

• copyright infringement, where you used someone’s article without their permission. Or maybe you used someone’s music in one of your ads without their permission. Or maybe you used someone’s photo or video without their permission. It’s one thing to read, listen to, or watch something for your own entertainment, but just because it’s on the web doesn’t mean you have a right to use it for your own gain. Typically, if you are using all or any one of these mediums to enhance sales of your own products, then you may owe the rightful owners of such products a portion of the sales for their effort in helping you to make that money!
• plagiarism, which goes hand-in-hand with the above paragraph, is also something you want to avoid. This means taking someone else’s work and claiming it as your own. In this business in particular there are all kinds of written products, with all kinds of legal permissions involved, such as PLR (private label rights) to MRSR (master resell rights). And even within those, there can be specific permissions given. In a later article we will discuss what all those permission types are and how they are used. But know also, that the search engines have software that looks for duplicate content. I even have a copy of one such product myself, which even tells me in percentages how close my writing is to someone else’s! If the search engines see duplicate content, then they will place less importance on it because it is not new and fresh, and therefore will not rank your site as high. So besides the legal issues, there are marketing issues why you should not copy someone else’s content!
• exaggerating facts. You can’t just “exaggerate” claims to people just because they may be half way around the world, and aren’t likely to come after you! Your business has to be conducted fully “above board” so that people know what they can “really” expect. In other words, you can’t write a headline that says that people are going to make a certain amount of money in a certain length of time. You have no control over what people do, so you have no way of knowing whether they will or won’t. As you can see by the aformentioned article in mThink.com, even saying they can make “up to” a certain amount can trigger an audit of your activities by the authorities.
• failure to use disclaimers. Making money from people without their knowledge is also something that is against the law. No matter how you make your money, it must be disclosed somewhere on your site in plain view. It may be obvious to most people that if there is a big yellow “buy now” button on the page, that you are selling something. Less obvious are the word links that you put on your site, such as the ones you find on my sites, some of which I put there, while others may be provided by Skimlinks. There are several companies out there that provide software to create these “contextual links”, or you can simply create your own links. Companies like Adsense also provide contextual advertising, meaning the ads shown are “in context” with the topic of the page. Either way, sometimes money is made from a reader simply clicking on those links, whether they buy anything or not. That action is not made clear to the reader. If they don’t like what you have to say, maybe they would prefer that you didn’t make money off their efforts. That is their right to refuse to do business with you, so if there is way of that happening that is not readily apparent, it is considered deceptive, and you have to tell them. That’s the law!
• fabricated testimonials. If you put testimonials on your site, it is permissible to use simply initials, in case the “testifier” would prefer to remain anonymous, but you had better retain the proof of those testimonials in case the feds come knocking at your door! It is illegal to fabricate testimonials or to use people’s remarks out of context and without their permission! Always ask permission if you can use their remarks! And in reality, the more credible a testimonial looks, the better effect it has. The mention of your name or business in their remarks is always a bonus, and of course, having their full name in the credits also helps. Beyond that, the use of video testimonials is on the rise, so having them on your site “in person” endorsing your product is about as good as it gets!

When NOT to use testimonials!

There can be many reasons, but the reason that I don’t show them anymore is simple… some of the people who gave them are no longer being trained by me. They gave their testimonial when they first started, but then I discovered that they werent following through with what I recommended, and their sites never came up to the quality that they should have been.

Keep in mind, I can’t do your work for you! I can advise you on what you should do, but if you don’t do it, that’s not my fault! In turn, I will not give references to students or their sites if those sites aren’t up to the quality of what they should be. If my readers go to those sites and see crappy work, then it reflects badly on me, even though I didn’t build them!

On top of that, providing testimonials is like providing a link to those sites, which I would be glad to do if they were something that I could be proud to recommend. But when they aren’t, or are totally off topic of my own site, then those inbound links are both worthless to the search engines, but are “un-earned” by the site owner.

Summary and Expectations

There are many more things that you need to be aware of, but those mentioned above seem to be the most noticeable, and will get you in trouble the quickest. To stay aware of the rest, I suggest you get a free subscription to mThink, and be sure to read the articles like this latest one on how to stay legal in your business. This magazine is totally free, and available in both print and emailed newsletter editions. The emailed notifications are usually sent about every week to three weeks, depending on when the posts are written. The sign-up link for the newsletter is right in the header on the right side. They also have other magazines geared toward this trade and in other specialites, and you can choose which ones you get when you sign up.

In future posts I will get more in depth into the different types of permissions available for written products, many of which could be used for posts on your site, as enticements to opt-in for the free reports, to be given as bonuses with other products, or even to be sold outright. It’s all a part of marketing “know-how” and in running ANY kind of web site online, and no matter what you sell online, you need to know about these things in order to be in this business.

We’ll also get back to the various ways to make money online with your web site or blog, so stick around, and as always, let me know your thoughts.

Thanks for reading.

(Update 11/11/12: The article mentioned above has since been moved or removed from the mThink.com site, so we changed the link to go to the main site only.)