How Brands Can Avoid The Legal Pitfalls Of UGC Marketing

Since Instagram was founded in 2010, the social network has been enjoying turbo-charged growth. In just five years, the network has gone from being just another student-founded tech minnow, to receiving a $35 billion valuation in December and overtaking Twitter to become the second largest social network to emanate from the U.S.

Of course the rise and rise of Instagram hasn’t been lost on the business world. Brand marketers are rushing headlong to take advantage of the 70 million pieces of user-generated content (UGC) uploaded every day -- particularly pictures featuring their products -- not to mention the billions more generated by Facebook, Twitter and others.

Recent consumer research reveals what’s behind this trend. Eighty-four percent of Millennials state UGC has influenced what they buy, while featuring use- generated photos at point of purchase has been proven to boost conversion for businesses by up to 7%.

But this growing fervor for UGC generated on social platforms begs an important question. What do brands need to know about UGC rights issues, and how can marketers make sure they operate within the law? It’s an issue U.S. retailer Duane Reade is only too aware of, having been caught up in a lawsuit not long ago for posting a photo (without permission) on Twitter of actress Katherine Heigl holding two of its bags. So what should brand marketers do to avoid similar costly mistakes?

Operating within the law

The bottom line is, brands need to ensure they obtain the appropriate permissions from the content creator. There are two straightforward ways to gain permission. The first is by obtaining “explicit” permission. To give an example, when marketers run campaigns that are intended to generate UGC, such as a photo contest on Facebook, the terms and conditions usually make it clear that, by entering, participants agree that their submitted content may be used for marketing purposes.

Alternatively, they could do this by obtaining “implicit” permission. This is the case where specific campaign hashtags are used as part of a campaign -- for example, a photo contest on Instagram, where the hashtag can be announced on the network with a link to the competition rules and associated terms and conditions.

But, the simple answer is to have clear terms and conditions stating you reserve the right to use UGC created for promotions you run.

The rights management process

Social marketers know that the volume of UGC featuring their brand can be overwhelming. So it makes sense to ensure the whole process of negotiating the minefield is as straightforward and legally buttoned down as possible. The obvious solution is for marketers to source a supplier who can do this.

Any supplier should enable marketers to request and track content rights in three different ways. The first is to manually grant rights if you’ve had offline discussions with a user, for example via email or the telephone.

The second is to manually contact users and provide  a special “claim URL” where they can sign in and grant/deny rights to the chosen content.

Finally, have the supplier platform automatically contact users by tweeting or commenting on their content post with the claim URL displayed.

Once you have a rights management system in place, it’s possible to harness positive UGC with peace of mind for a myriad of tactics, including socializing brand sites, bringing mobile apps to life or showcasing products on in-store displays.

So unwary marketers beware: There’s no denying UGC is gold dust for businesses, but make sure you have clear procedures in place to avoid the pitfalls around rights and permission.


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3 comments about "How Brands Can Avoid The Legal Pitfalls Of UGC Marketing".
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  1. Jeffrey Millar from Tequila Group, March 18, 2015 at 4:29 p.m.

    Let me take a moment to relate our policy. Tequila Group is a full service advertising firm. No photograph is allowed to be used, on any platform, channel or for any reason whatsoever, without written permission. You get in to trouble by not understanding copyright law , thinking you have permission to re-post a photograph that has been posted on another digital channel. You don't. Second, we often are told my manufactures that we are cleared to use their photos. Again, we require this to be in writing. Too many times permission from above has been denied or policy has not been set. I worry about manufactures that haven't cleared "Use" licensing rights with the photographer or firm that took the pics in the first place. Error on the side of caution and stay out of court. Get permission in writing. Even simple UGC sent to us by an employee of a client must be released in writing by that employee.

  2. John Van Wagner from Piqora, March 26, 2015 at 4:12 p.m.

    Can you provide the source or attribution for the statistic about UGC drives conversion up by 7% please?

  3. Richard Jones from EngageSciences, March 26, 2015 at 6:02 p.m.

    John - you can see the attribution for this research and similar studies from Comscore, Evercore and others here:

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