“While facts tell and stories sell, a dominating digital footprint will help you build a dynasty!” -Jon Mitchell “Mitch” Jackson
If you’re going to take your offline business online or, start a new business on the digital platforms, there are 9 things I think you need to know, understand and do. My recommendations are based on 30 years of practicing law and helping clients start hundreds of new companies. They are also based upon my own experiences relating to our firm’s online presence since 1996.
Before we get started, please remember that although I am a lawyer, I’m not your lawyer. This is not legal advice. Also, the laws in each state are different so please contact an experienced attorney in your state to discuss your questions, legal needs and options.
DO BUSINESS AS A CORPORATION OR LLC
The unfortunate question in today’s business world isn’t if you’ll be sued, it’s when. According to recent statistics, the average small business owner will be sued at least 3 times during his or her business lifetime. Knowing this, I encourage you to please be smart, plan ahead, and take steps to protect yourself and your business before something bad happens.
Corporations and Limited Liability Companies (LLC) allow you to put a protective shield between your customer, business, and your personal life. If you correctly set up, run and manage your company (and that’s a big if), your personal assets will be protected if a claim or lawsuit is ever brought against your business.
Most people don’t set up their corporations and LLCs correctly. Those who do often times drop the ball down the line when it comes to managing the entity. Their are numerous filing, registration, legal, tax and insurance requirements that all must be setup and managed correctly over the long-term. The point of this article is to make you aware of these requirements. An experienced professional in your city and state can hold your hand and make sure you do everything correctly.
One more thing. In my opinion you should never do business as a sole proprietor or general partnership. For the above reasons (and many more), there’s just too much liability attached to doing so. Doing business as a sole proprietor is by far the biggest mistake I see people make when doing business online. Instead, form a corporation or LLC and do business as a legal business entity.
Use Intellectual Property (IP) law (copyrights, trade names, trademarks…) to protect your products, services and ideas. This is a very complicated area of the law and so if you have something worth protecting, it is important to take the necessary IP steps to protect your legal rights. I’d recommend that you contact an experienced lawyer in your state to discuss options and needs. The US Small Business Administration website offers several good resources you may want to review.
Respect other people and company’s IP rights. Don’t use someone else’s pictures, videos, and music without their written permission. You may be breaking the law and exposing yourself to civil money damages if you do so.
There are plenty of resources on the Internet that allow you to use or purchase images, videos and songs for your online work. Either create your own or take advantage of these sites and you’ll never have to worry about an intellectual property claim being filed against you. Here’s a great article that I found at the Social Media Examiner website on this topic.
PROMOTE YOUR PRODUCT AND SERVICES THROUGH YOUR BUSINESS
When communicating while doing business, make sure your audience knows that you’re doing so on behalf of your business.
By doing this, the protective shield I mentioned above will usually limit the claims against your business and stop them dead in their tracks. Your personal life, assets and bank accounts will not be exposed to your business liabilities.
This needs to be done in all off and online content. For example, when you’re sharing on social or starting a live stream like Periscope and Blab, let your audience know that your content is being presented and shared on behalf of your company and not you personally. You can do this by simply including something like the following in the first 30-60 seconds of your show- “Today’s Periscope is brought to you by the XYZ Company, a leader in the mobile app community.”
What’s important to remember is to share this fact towards the beginning of your broadcast so that it’s clear that the information, products and services provided are by the XYZ Company. This is easy to do but rarely done. It’s a good idea to repeat this type of message every ten minutes or so to give notice to people who join your presentation sometime after it starts. I know this sounds like a hassle to do but it’s the smart thing to do.
Your websites, blogs and other digital platforms and communications should clearly give notice that your company is a corporation or LLC. This includes all logos, emails and letters.
USE CONTRACTS AND OTHER WRITTEN AGREEMENTS
Almost everything you do online involves contract law. Be smart and communicate and confirm all deals, proposals and agreements in writing. No, a phone call, email or text is not good enough. Life would be a lot simpler if digital wink is all that it takes to create a binding agreement. It isn’t!
Before representing another person or company’s product or service, read all contracts and agreements. Communicate any issues and confirm all agreements in writing.
Influencers need to make sure they are not assuming liability by promoting other people’s products and services. Agreements are available to help you do just that. State and Federal disclosure laws should also be followed. I shared important tips about Influencer Liability in this earlier post.
I tell all my clients to always put everything in writing. Take the time and make the effort to do your due diligence before clicking and agreeing to use, promote or sell a new product or service.
Everything you do in your online business must be focused on providing an excellent product or service in a way that creates an exemplary customer experience. You must develop and maintain a relevant digital footprint. To do so you must embrace technology. If you fail in any of these efforts your existing and potential clients will simply click or swipe and go someplace else.
Today’s consumer expects you to deliver your products and services in a manner that is both familiar and mobile friendly. Creating a digital experience that easily accommodates swiping and tapping will result in smiles and sales. Requiring customers to place orders by phone or via desktop only friendly website will result in lost sales and a short business life.
Creating a transparent and quality customer experience is a requirement and not an option. In fact, your reputation depends on it.
Satisfying this requirement necessarily involves communicating with your customer the way he or she wants to be communicated to. If a customer spends her time on Snapchat and wants to communicate with you using this platform via the new video or audio in the updated Snapchat Chat 2.0 (we just talked about this on Blab), then do what you need to do to make this happen. Do you offer a 24/7 customer portal or live answering service that allows customers to get information and communicate when they want to?
Doing this will help you build strong and positive long-term relationships. Having said that, every one in awhile you’re going to get a complaint or hater. When this happens, you and everyone else in your company need to learn how to hug your haters. Here’s how you do just that (Jay Baer’s new book “Hug Your Haters”)
I think that if you want to stand out and get noticed, it’s important to be an early adaptor and embrace new digital platforms. Think of each platform as a welcome mat to your business. The more welcome mats you have, the greater the convenience to your potential customers and the greater the opportunity to create relationships and sales.
When all said and done, remember that it doesn’t matter what you want. All that matters is what the customer wants and the experience your customer has with your products and services (think Zappos).
HELP, SHARE AND ADD VALUE
What I’ve noticed over the years is that the people and companies who are dominating online are the very same people and companies who focus on helping others, sharing, and adding massive value to their community.
Everything they do revolves around creating community. By solving their customers problems with products and solutions, relationships are formed and trust is earned. Sales are a natural extension of all the above.
Several great books on these topics inlude Jay Baer’s “Youtility” and Bryan Kramer’s “Shareology- How Sharing Powers the Human Economy”
MEDIATION AND ARBITRATION
When individuals and small businesses are setting up and using contracts to support their online efforts, I recommend communicating clearly in writing, in large bold print, a mediation and arbitration provision. Have a place next to the paragraphs for the other person to initial and date. Note that the laws in each state vary so check with local counsel about how to do this correctly in your state.
The fact of the matter is that having and clearly communicating the existence of your mediation and arbitration agreements will increase the chances of you having the opportunity to resolve a dispute with another party without the need for litigation. Not only will you save a great amount of time and aggravation by avoiding litigation, you’ll also save a great deal of money.
ATTORNEY FEES CLAUSE
A good attorney fees clause will do two things. First, it will help eliminate frivolous lawsuits because the winning party will be entitled to have her attorney fees paid by the other side. The end result is that people will think twice about suing you.
Second, a properly drafted attorney fees clause may allow you to retain a good lawyer who you may not otherwise be able to afford. For example, if a client comes into my office with a good case but can’t afford to pay my hourly rate, I may still take the case if there is an attorney fees clause. I know that if I win the case I will get paid by the other side and this is added incentive for me to agree to get involved.
A well written and communicated venue clause will determine where all legal disputes will be filed and resolved. Smart business owners have venue clauses in all their contracts and invoices.
For example, let’s say you have venue clause that states all disputes and litigation will take place in Orange County, California. A disgruntled New York based customer will need to travel to Orange County to resolve all disputes. If litigation becomes necessary, the New York customer will need to hire California legal counsel to handle his dispute or claim in Orange County.
A good venue clause can be an effective deterrent to frivolous or minor claims. It can also be a good tool to help you keep your litigation expenses to a minimum.
I enjoy and embrace the Internet, social media, and live streaming platforms. When it comes to setting up and running a new online business, what used to take weeks and even months to accomplish, can now be done in minutes or hours with just a couple of mouse clicks.
Despite the new ease of bringing your existing offline business online or, staring a new online business from scratch, it’s important to remember that speed and ease of use do not translate into safety and long-term security in business. Review and discuss these tips with your business partner, advisor and/or lawyer and see if how you can incorporate these approaches into your everyday online business efforts.
Other books I recommend in no particular order:
“A Trial Lawyer’s Negotiation Secrets” (30K views) by Mitch Jackson
Jon Mitchell “Mitch” Jackson is an award winning California Trial Lawyer and in 2013 was named one of California’s Litigation Lawyers of the Year. In 2009 he was also recognized as one of Orange County’s Trial Lawyers of the Year.
When he’s not in court trying cases, Mitch enjoys showing professionals, business owners and entrepreneurs how to use social media and live streaming to disrupt, hack and improve their professional relationships, businesses and practices. Connect with Mitch on Twitter @MitchJackson and at his law firm JacksonandWilson.com. Many of his daily live streams are shared at Streaming. Lawyer and his popular weekly talk show is TheShow.live (upcoming guests include Brian Fanzo 04-04 and Gary Vaynerchuk 04-11)
Follow up Blab (live stream discussion)