10 Must-Haves for All Terms and Conditions for Digital Products
Want to know what you need in your terms and conditions for digital products? These are the essential terms you need to protect your content and money!
Selling your own digital products is a great way to earn passive income, but if you’re anything like me, you want to protect yourself against copycats, chargebacks, and liability risks. As a lawyer myself who drafts contracts for online entrepreneurs like you, I am giving you the essential terms you need in your terms and conditions for digital products to protect your intellectual property and money.
I will tell you what you need in your terms and conditions for digital products, basically handing you a terms and conditions for digital products template, so that you’ll have the perfect digital Product disclaimer for your website.
After learning about what you need in your terms and conditions for digital products, you will have all the must-have terms you need to protect your content and hard-earned money.
This post is all about the must-have for your terms and conditions for digital products to protect your content, business, and money.
Ultimate Terms and Conditions for Digital Products
10 must-haves to create the best terms and conditions for digital products example
Now, let’s get into what those 10 must-haves are to create the best terms and conditions for digital products example.
1. Access and Limitations
Your customers need to know exactly how they’ll receive your digital products. Specify the following:
Specify where your customers can access/download the product. Do they receive a link within your shop after purchase? Will they get access through their user accounts? Will a link be sent via WeTransfer or email? Or are you using a third-party digital distribution platform, like WeTrasnfer? Describe the exact process.
State time limits for download links. You must mention how long the download link will work. Explicitly state that your customers can no longer access your digital products if they do not download them within that time limit. You may still choose to send them a new link if they ask you to, but they are no longer entitled to receive those products. You snooze, you lose!
Include the right for you to refuse access or cancel the download if the customer violates your terms (e.g., chargebacks, unauthorised use or sharing).
2. Format & Compitibility
Your terms and conditions for digital products must specify the following
You must specify the file formats in which you make your digital products available to your customers. For example:
“PDF (Portable Document Format)” if you sell eBooks or meal plans.
“DOCX (Office Open XML)” if you sell workbooks in the form of Word documents.
“PNG (Portable Network Graphics)” if you sell photos, digital designs or digital art.
“MP4 (MPED-V AVC)” if you sell videos.
If you sell digital products in multiple formats, name all of them
State the software and devices you recommend your customers use to access and use digital products. For example:
“Adobe Acrobat Reader” and “Amazon Kindle” if you sell eBooks in PDF format.
“Microsoft Word” and “Pages” if you sell Word documents.
“Preview” and “Adobe Illustrator” if you sell photos or graphics in PNG format.
“VLC Media Player” or “QuickTime Player” if you sell videos.
Include a disclaimer that your products are designed for these software and devices, but you’re not responsible for compatibility issues. Your digital products may work with those devices and software now, but future changes in your products or the software itself may make them incompatible.
3. Disclaimers
That brings me to the next must-have for your terms and conditions for digital products: disclaimers. To avoid liability risks, you must include a digital product disclaimer list, including (at the very least) the following:
Professional advice disclaimer: You must state that your digital products are for informational and educational purposes only. Explicitly state that the digital products contain general information and are not, and should not be, construed as any kind of professional advice.
No professional-client relationship: Also, make clear that the purchase of your digital products does not establish any kind of professional-client relationship with you. Access to your products does NOT mean access to you.
Errors and omissions: You are not perfect, and your digital products will also not be. They will likely contain some errors or mistakes here and there. Some of the information may become outdated over time. That’s why you need a disclaimer stating that you do not guarantee that the content will be true, accurate, complete, current, or free from errors or omissions.
No warranties or guarantees: To avoid any liabilities due to expectations your customers may have, however unreasonable they may be, you need to explicitly state that you do not provide any warranties or guarantees, either expressed or implied. Your customers may have certain expectations as to the content of your digital products that you have not even considered, so you must protect yourself against that preventatively.
Non-reliance: Clarify that your customers use this information at their own risk. You are not responsible or liable for their reliance on the information.
Results and outcomes disclaimer: You certainly can not guarantee the effectiveness of your products or any outcomes or results they may have for your customers. Therefore, you need disclaimers stating that you do not guarantee the effectiveness of your digital products and what results or outcomes your customers may have when using them.
4. Usage (Not Ownership!) Rights
Your digital products are your intellectual property that you give your customers access to but do not receive ownership of. Your customers are buying a license, not ownership.
So, in your terms and conditions for digital products, you must make clear that your customers only receive a license, explaining that it is a right to use your digital products for their personal use only.
5. Protect against Copycats & Oversharers
That brings me to the next crucial element of your terms and conditions for digital products: protection for copycats.
Unfortunately, some people will try to repackage and resell your digital products. Therefore, it’s even more important to clearly outline what your customers may NOT use your digital products for. Stop them in their tracks by including the following in your terms and conditions for digital products template:
You want to specify that your customers may use your digital products for personal use only, not commercial use.
Explicitly forbid redistribution, resale, and reproduction.
Prohibit sharing of the product with third parties (including their so-called friends and family).
6. Limiting Your Liability
No matter how great your digital products are, things can go wrong, and your customers might blame you for those things (even if it really isn’t your fault).
That’s why you need an iron-clad liability clause in your terms and conditions for digital products that includes the following:
Exclude your liability by stating that you can not be held liable for any direct, indirect, consequential, or incidental damages.
In some cases, however, the court may decide that your liability can’t be completely excluded. You can not exclude your liability for everything. Therefore, you must also cap your total liability to the amount the customer actually paid.
Make sure you have the proper legal wording in your terms and conditions for digital products template for your liability clause. If anything does turn out to be incorrect, the court could consider the entire clause null and void, and you’ll still be held liable without limitation.
7. Payment Terms & Options
Consider whether you want to offer payment plans or require full payment upfront.
Keep in mind that your digital products can’t be “returned”. Your customer can still keep your digital products if they end up not paying the remaining part of the fee. Will it make financial sense for you to sue a customer if they don’t pay? Probably not if it’s a $149 product.
However, if your digital products are more expensive and you want to make them affordable for everyone, you may want to give customers the option to pay in instalments. In that case, your terms and conditions for digital products must be very specific about what amounts your customers pay and when.
8. No Refunds (Unless You Want to Offer Them)
As I said, because of the nature of digital products, your digital products can be “returned”, so what should you state about cancellations and refunds?
Here’s what you should specify in your terms and conditions for digital products:
Cancellation policy: If your customers are consumers (as opposed to business owners), those customers will have rights to a “cooling-off” or “withdrawal” period after their purchase unless they waive those rights specifically. So, in any case, ensure you have a waiver in your terms and conditions for digital products that explicitly states that they agree to waive those rights.
Satisfaction guarantee: You may, under your own conditions, want to provide a satisfaction guarantee to your customers, meaning they can get their money back if they are not satisfied with your digital product or if it was not what they expected. I do not recommend offering refunds, but some of my clients do want that, so I provide that option in my terms and conditions for digital products template.
Refund policy: There are two options for your refund policy:
If you do not want to offer refunds, explicitly state in your terms and conditions that your digital products are non-refundable.
If you do want to offer refunds, specify the period during which your customers may request a refund. You must also stipulate under which conditions a student may ask for a refund and the refund amount (50%? 100%?). For example, you may require proof from your customer that your customer has tried your meal plan or filled out at least 50% of your workbook. And, in any case, always include that you will decide at your own discretion whether you will provide a refund or not. If you do not feel like your customer deserves it or is lying, you should be able to refuse a refund without explanation. You do not want to end up in a debate.
9. Compliance with Privacy Laws
When your customers purchase your digital products, they must provide their personal information, like their name, email and payment information.
Since you collect customer data, you must comply with privacy laws, which require you to inform your customers about how you collect, store and use their personal information. If you don’t, you could be faced with major legal penalties.
Thus, you must by law do the following:
link to your privacy policy in your terms.
Clarify in that privacy policy how you collect, store, and use customer data.
10. Updates & Future Access
From time to time, you may update your digital products.
To prevent misunderstandings and claims, you must be clear about whether your customers will receive access to the new content. Do your customers deserve to receive the updated version that is relevant next year for free?
Clearly state the following in your terms and conditions for digital products:
Clarify if updates are included or if your customers will need to purchase any new versions.
If your customers do receive access to updated versions, define whether customers get lifetime access or access for a limited time.
Now, you know exactly what essential you need for your terms and conditions for digital products to ensure you get paid what you deserve and safeguard your hard-earned cash and content.
The ULTIMATE terms and conditions for digital products template
Want a plug-and-play template that covers all of this (and more)?
My terms and conditions for digital products template includes all the protections you need!
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Learn more about my terms and conditions for digital products template!
The best privacy policy for digital products you (legally) need
If you’re selling digital products on your website, you’ll need a privacy policy for digital products. You’ll also need terms and conditions and disclaimers for your website.
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This post was all about the essentials your terms and conditions for digital products must have to protect your content & your money.
You can get your terms and conditions for digital products on this page of my contract shop!
Do you have an online course? Then you need online course terms and conditions. Read about all you need in this blog post on the 11 Must-Haves for Your Course Terms and Conditions.
Or learn more about my terms and conditions for online courses template!
