The popularity of the PayPal-owned service took a hit when a tuber made a revealing video.
The Honey service, owned by Paypal, has come under the eye of YouTubers due to its business model, which has been described as unfair and even a scam. John G Mabanglo
There is a buzz among YouTube’s biggest content producers. The uproar started around Christmas, when a Youtube account focused on investigative journalism in the technology industry Megalag posted a video From a service called Honey.
The moniker Megalag has previously become known for, among other things, a prank in which he sent Apple’s Airtag locators For Elon MuskApple’s For Tim Cook and North Korea.
Honey is a web browser add-on that is supposed to search for and try discount and advantage codes for various online stores on behalf of the user.
The add-on has become known, among other things, through the advertisements of countless popular YouTube accounts. The service was acquired by Paypal in 2020 with a transaction amount of four billion dollars.
No best discounts
In its video, Megalag accuses the Honey service of various scams. According to the claims, the business model of the service is unfair to both content producers and consumer customers.
The problem for consumer customers is that Honey has a paid partnership system for online stores. With the cooperation agreement, Verkkokaupat can influence which discount codes the add-on offers to the user.
The online store can set Honey to use a code for a small discount, even if there are codes for a larger discount. This despite the fact that the service advertises that it offers the user the best possible price.
Commissions away from tube players
From the point of view of YouTube content producers, the operation of the browser add-on with so-called affiliate or partnership links is problematic.
Many content creators can include e-commerce links to the products featured in their videos in the captions of their videos. When using links, the cookie ensures that the content creator who presented the product receives a commission from the sale of the online store.
If the user instead has the Honey add-on in use, searching for discount coupon codes changes the cookie and the partnership commission goes to Honey instead of the content producer who introduced the product. To change the cookie, it’s enough to search for coupons and click on the add-on’s notification, even if it doesn’t find any discount codes.
The Honey add-on has been around for several years, but very little attention has been paid to its functionality in the past. An employee of Linus Media Group, which owns the popular Linus Tech Tips channel, mentioned in an online chat in 2022 that the company had stopped working with Honey. The reason was precisely the operation of the service with partnership links. The channel had managed to advertise the Honey add-on several times since 2017.
Lawsuits filed
So far, it’s only about the claims made in Megalag’s video, but many tubers who previously promoted the service, such as the technology-focused Marques Brownlee calls now to give up about using the add-on.
The service has commented on the matter to some media and told that the operation is in accordance with the general practices of the industry.
At least two popular content creators has announced to raise class action against PayPal, the owner of the Honey service. More information about the functionality of the add-on and the service’s way of making money will be made public if the class actions proceed all the way to court.