I censored the retailer's tag, because in all fairness, it's not their fault for selling a product which the designer failed to check before mass-producing.
|Apologies for the flashes|
This brings me to our first lesson: It's vs. Its.
It's is a contraction, made up of a pronoun (it) plus a verb (is or has).
"It is raining" is the same as "it's raining."
"It has been raining" is the same as "It's been raining."
The best way to test this is to replace the contraction with "is" or "has." In the photo above, "a dog wags it [has] tail with it [is] heart" makes absolutely no sense; therefore, the use of "it's" is wrong.
Its, on the other hand, shows possession.
Of course, we do use apostrophes to show possession in many cases ("the dog's tail," "Susan's book," etc.), which is likely why there is some confusion when it comes to it's and its.
Its differs from possessives like "Susan's" in that it is the neuter form of him or her; the best way to determine if you're using its correctly is to substitute it with one of these words (or with another posssessive, such as: my, our, your, or their) to see if it makes sense. In the photo, "a dog wags her tail with her heart" still makes sense, so we know that the correct form is its.
Further questions? Leave a comment below!