What You Need to Know About Commercial Use in 2024

As a marketer in 2024, one of the most critical legal concepts you need to understand is "commercial use." Anytime you create content, campaigns, or assets to promote your business and drive profit, copyright law and commercial use licenses come into play.

Using third-party creative works—anything from stock photos and fonts to music and software—without the proper commercial license can land your company in serious legal and financial trouble. In fact, copyright infringement cases cost businesses an estimated $4.2 billion in 2023 alone, according to the Intellectual Property Owners Association.

To avoid these costly risks and create compelling content that drives results, it‘s essential to educate yourself on the ins and outs of commercial use. In this comprehensive guide, we‘ll break down everything you need to know to confidently navigate this complex legal landscape.

Defining Commercial Use

At its simplest, commercial use means using a copyrighted work for business purposes and financial gain. If you leverage a creative asset in any way to promote, advertise, or represent your company with the goal of driving sales and profit, either directly or indirectly, it constitutes commercial use.

Some common examples of commercial use in marketing include:

• Featuring a licensed photo in social media ads to promote a new product launch
• Adding background music to a brand video showcasing your company culture
• Designing a sales brochure with premium stock graphics and fonts
• Printing your logo with a trademarked brand‘s imagery on merchandise

The key factor is that your use of the asset is tied to your company‘s commercial activity and ultimately aimed at generating revenue, even if the connection is indirect.

In contrast, non-commercial use involves using copyrighted works for personal purposes unrelated to any business or profit-seeking endeavors. This could include something like adding your favorite song to a home movie that you only share with family or using branded images to make a meme you text to friends. No money is being made and the usage is solely for personal enjoyment or expression.

Many creative assets have separate license tiers for commercial and non-commercial use, with the latter typically being cheaper or even free since the financial stakes are lower. However, using a work licensed only for non-commercial use to promote your business would constitute copyright infringement.

To further illustrate the key differences, here‘s a quick reference table:

The Cost of Copyright Infringement

So why should marketers and businesses care so much about obtaining proper commercial use licenses? In short, failing to do so can result in pricey lawsuits and legal settlements that can easily soar into the six or even seven figures.

According to data from the World Intellectual Property Organization, the average cost of a copyright infringement lawsuit in the U.S. is $250,000. And that‘s just the direct financial hit—companies also have to contend with negative press, damaged partner relationships, and countless hours of time and effort dealing with the fallout.

Some recent high-profile commercial use cases include:

• Peloton: The fitness tech company was sued by several major music publishers for using popular songs in their video workouts without proper synchronization licenses. In 2020, Peloton settled the lawsuit for over $49 million.

• H&M: The fashion retailer faced backlash after using a graffiti artist‘s work in an ad campaign video without his permission. The artist sued for copyright infringement and the case was settled for an undisclosed amount.

• Procter & Gamble: The consumer goods giant was ordered to pay $19.25 million in damages after they were found guilty of willfully infringing on a photographer‘s copyrights by using his images in a national ad campaign without a license.

As you can see, even major corporations with big budgets and legal teams aren‘t immune to the costs of skirting commercial use law. For smaller businesses and marketers, one commercial use misstep could easily doom the company altogether.

"Using creative assets without a license is like playing Russian roulette with your business," says Meredith Chandler, a copyright attorney and partner at Fierst, Kane & Bloomberg LLP. "You might get lucky and avoid an expensive lawsuit, but it‘s simply not worth the risk. Investing in proper commercial use licenses is a necessary cost of doing business in our digital world."

Commercial Use in Content Marketing

For digital marketers, understanding commercial use is especially crucial since so much of our work revolves around content creation. Anytime you produce a blog post, social media graphic, video, podcast episode, or interactive tool to engage your audience and drive toward business goals, commercial use considerations come into play. Some specific content types to watch out for include:

• Website imagery and graphics: Using stock photos or illustrations on your company website or product pages requires a commercial license, even if you‘re not directly selling the images themselves.

• Social media content: Anytime you post third-party creative works on your brand‘s social channels, a commercial license is required since the content is tied to promoting your business. This is true even if it‘s on "organic" unpaid posts.

• Video and audio assets: Adding music, sound effects, footage or voiceovers to your brand videos, webinars, and advertisements requires securing the right commercial licenses, even if the assets came from a stock media library.

• Marketing collateral: Using licensed fonts, graphics, and templates in the brochures, whitepapers, case studies and slide decks you use to pitch prospects requires that those assets allow for this specific type of commercial use.

"One of the biggest misconceptions I see is marketers assuming that just because they downloaded a photo or track from a stock site, they‘re automatically covered to use it for commercial purposes," notes Raul Mercado, Head of IP Clearance at Shutterstock. "The reality is, most stock assets have several license tiers and restrictions around commercial use, so it‘s critical to understand exactly what you‘re getting before publishing that asset in your marketing content."

Here‘s a quick checklist marketers can use to vet an asset‘s commercial use permissions before using it in content:

• [ ] Purchased an extended commercial license, not just the standard license
• [ ] License allows for your specific use case (e.g. digital advertising vs. print vs. broadcast)
• [ ] No restrictions that would disqualify your usage (e.g. sensitive industries, impression limits)
• [ ] All talent releases and model clearances secured for people featured
• [ ] Usage is within the set time limit of the license (e.g. in perpetuity vs. 1 year)

Taking a few minutes to run through these criteria can save you massive legal headaches down the road. When in doubt, always reach out to the copyright holder directly to explain your intended use case and verify that you‘re properly licensed.

Best Practices for Navigating Commercial Use

For marketers and businesses, getting a handle on commercial use ultimately comes down to establishing smart policies and processes for sourcing and managing your creative assets. Here are some expert tips and best practices to keep your company in the clear:

1. Centralize your asset management: Implement a system like a digital asset manager (DAM) to organize all of your licensed assets, along with their specific usage rights and restrictions, in one central location. This makes it easy for team members to quickly check that they have the commercial use go-ahead.

2. Invest in comprehensive licenses: Consider purchasing team-wide subscriptions or extended licenses from trusted content providers like Shutterstock or Getty Images. These give you broad commercial use rights across a variety of assets so you don‘t have to worry about one-off clearances.

3. Develop a commercial use checklist: Create a standardized criteria list (like the one above) that all team members reference before using any third-party asset. Require sign-off from a manager or legal stakeholder for high-visibility commercial use cases.

4. Set usage guidelines: Establish clear rules around how licensed assets can and can‘t be used based on their allowances. For example, you may set a policy that no asset can be printed on physical merchandise unless it has an explicit merchandise-use license.

5. Work closely with legal: Loop in your legal team early and often to gut-check your commercial use approach and escalate any concerns. Some companies even have a dedicated IP specialist on the marketing or creative team to handle licensing and usage issues.

The key is to be proactive and meticulous in managing your creative assets and licenses, rather than risking a costly "ask for forgiveness" approach. "We‘ve seen far too many companies get burned by lax commercial use policies and record-keeping," says Chandler. "The companies that are thriving today have made commercial use compliance a key priority and invested in the people, partners, and tools to manage it effectively."

The Future of Commercial Use

As new content mediums and licensing models emerge, the already complex world of commercial use is poised to shift in the coming years. Factors like AI-generated imagery, open-source creative commons licenses, and blockchain-based content tracking are all complicating traditional commercial use protocols.

For example, AI image generators like DALL-E and Midjourney allow users to create novel images simply by typing in a prompt. While this would seemingly eliminate commercial use concerns, there are still issues around the copyright of the training data used to fuel the AI. Several lawsuits are already in progress challenging the commercial use of AI content trained on copyrighted images.

Additionally, NFTs are introducing new licensing and ownership models that could upend typical commercial use practices. The ability to trace and authenticate an asset‘s usage across the blockchain could unlock more granular licensing based on specific consumption, rather than broad categories.

However, even with these technological shifts, the core tenets of commercial use—compensating creators fairly and obtaining explicit permission to use their works for business purposes—are unlikely to change.

"No matter what the content or platform, it will always be important for businesses to properly license assets and credit creators," says Mercado. "If anything, I anticipate commercial use compliance becoming even more critical as copyright laws evolve and consumers demand greater transparency from brands around these issues."

For marketers, getting ahead of the commercial use curve will be essential to successfully leveraging new creative technologies and mediums. By building a culture of compliance and investing in ongoing education, businesses can unlock the full potential of cutting-edge content while sidestepping infringement pitfalls.

Ultimately, approaching commercial use as an opportunity to create responsibly, rather than a burden to be skirted, is what will set thriving brands apart in the fast-approaching future of content.