Exposing the Honey Influencer Scam

Summary

This video exposes the deceptive practices of Honey, a browser extension owned by PayPal, which falsely claims to find the best online deals for consumers. In reality, Honey manipulates affiliate marketing by poaching commissions from influencers and withholding better discount codes in favor of those approved by partnered stores. While Honey offers some savings, its unethical tactics harm small creators and businesses. The investigation reveals how Honey’s aggressive marketing and opaque business model have misled millions of users, leading to a deep distrust in the company's true intentions.

Takeaways

• 😀 Honey's core value proposition is misleading; it claims to find the best deals but often withholds superior discount codes to benefit businesses paying for their services.
• 😀 Honey hijacks affiliate commissions by overriding links from content creators and influencers, diverting the commission credit to itself instead.
• 😀 The company's deceptive marketing strategies include false claims about always finding the best deals, which is contradicted by its selective couponing.
• 😀 Honey works closely with businesses to control which discount codes are shared, limiting consumers' access to better deals that might be available elsewhere.
• 😀 Consumers and influencers are unknowingly harmed by Honey's affiliate commission model, which can leave creators without their rightful revenue.
• 😀 The Better Business Bureau (BBB) launched an inquiry into Honey's misleading claims but dropped the case after Honey quietly ceased making those claims.
• 😀 Honey's partnerships with businesses involve significant affiliate commissions, but it forces businesses to withhold their best offers, undermining trust with consumers.
• 😀 Honey has sponsored thousands of videos across YouTube, promoting a product that harms the very creators who helped it grow by reducing their affiliate earnings.
• 😀 The investigation revealed that while Honey occasionally finds significant discounts, it is inconsistent, confusing consumers who may think it’s always offering the best deal.
• 😀 Small creators, who rely on affiliate commissions, are disproportionately harmed by Honey’s business model, as it cuts into their potential earnings.
• 😀 PayPal’s ownership of Honey amplifies the problem, as the company uses its position to make money from consumers and influencers without offering true value.

Q & A

What is the main issue with Honey, the browser extension?

The main issue with Honey is that it is allegedly stealing affiliate commissions from influencers by replacing their affiliate links with its own, claiming credit for the sale and pocketing the commission that would otherwise go to the influencer.

How does Honey interfere with affiliate marketing?

Honey interferes by removing affiliate tracking cookies placed by influencers and replacing them with its own, which allows it to claim the affiliate commission for sales, even if the influencer originally referred the customer.

What is 'last click attribution' and how does it relate to Honey's actions?

'Last click attribution' means that the last entity that interacted with a customer before the purchase gets the credit for the sale. Honey takes advantage of this by popping up at the checkout stage, guaranteeing it gets the last click, even when it hasn't played a role in the initial referral.

What are 'Honey Gold' and how do they contribute to the problem?

Honey Gold, now known as PayPal Rewards, is a cashback program where Honey offers a share of the affiliate commission it claims from a sale to the consumer in the form of points. This further incentivizes consumers to click on Honey's offer, often overriding legitimate affiliate links.

How much of the affiliate commission does Honey share with the consumer in Honey Gold?

In one example, Honey took a $35 affiliate commission and shared only 89 cents (89 points) with the consumer through Honey Gold, demonstrating the disproportionate share Honey keeps for itself.

Did any influencers realize Honey was taking their affiliate commissions?

Yes, at least one major influencer, Linus Tech Tips, noticed the issue and ended their partnership with Honey after discovering that Honey was overriding their affiliate links and taking credit for sales they referred.

How does Honey deceive consumers regarding its coupon code functionality?

Honey falsely claims to always find the best deals and apply the most effective coupons, but it selectively withholds better coupon codes in favor of those approved by partner stores, which are often less favorable for consumers.

What role does Honey play in controlling which coupon codes are available to consumers?

Honey allows partner stores to control which coupon codes are shown to consumers, meaning that stores can restrict the most valuable discounts from being offered, even if they are available elsewhere on the internet.

What was the reaction of the Better Business Bureau (BBB) to Honey's advertising claims?

The BBB launched an inquiry into Honey's advertising claims but dropped the case after Honey discontinued the problematic claims for 'business reasons,' leaving the issue unresolved.

What impact does Honey's practices have on small creators and bloggers?

Honey's actions harm small creators and bloggers who rely on affiliate commissions for income, as Honey's interference reduces or eliminates the commissions they would otherwise earn from their audience's purchases.