Is Honey a scam? Exposing the truth behind the browser extension.

Why everyone hates Honey now? The truth behind the browser extension

For years, the Honey browser extension seemed like a digital dream come true. Promising automatic coupon application and unbeatable savings, it quickly gained millions of users and widespread influencer endorsements. But beneath the surface of this seemingly benevolent tool, a complex web of questionable practices was brewing. This article will explore how Honey’s business model ultimately betrayed consumers, exploited influencers, and prioritised merchant interests, ultimately resulting in widespread disillusionment.

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How Honey seemed to work: A promise of savings

Honey’s core value proposition was simple: “We find you the best deals.” Here’s how it appeared to function for each of the key players:

Consumers

Honey promised to automatically scour the internet for coupon codes, applying the best one to your online shopping cart at checkout. The experience was designed to be seamless, passive, and ultimately, money-saving. It felt like “free money”, as some influencers proclaimed.

Influencers

Honey partnered with countless YouTubers, bloggers, and other online personalities, offering them a commission for each new user they referred to the platform. In many cases, this was an incredibly lucrative arrangement and resulted in numerous endorsements.

Merchants

Honey pitched itself as a valuable marketing partner for e-commerce businesses, claiming to drive increased sales and conversions. This would also allow Honey to control which coupons are used or not.

This win-win-win scenario was what fuelled Honey’s explosive growth and subsequent $4 billion acquisition by PayPal in 2019.

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The ugly truth: How Honey exploited everyone

However, the enclosed transcripts, revealing the findings of an independent researcher, reveal a much darker narrative. Honey was engaging in practices that undermined each of these participants for its own benefit.

1. Exploiting influencers: The “affiliate commission stealing” scandal

Lack of due diligence

Many influencers promoted Honey without fully understanding its underlying mechanics. They often repeated Honey’s marketing messaging that it would find “the best deals possible” without independently verifying these claims. This lack of due diligence allowed Honey to exploit their trusting audiences.

Affiliate link hijacking

The most egregious practice was Honey’s blatant hijacking of affiliate commissions. If a consumer clicked on an influencer’s affiliate link, signalling that they were referred by the influencer, Honey would secretly replace the influencer’s cookie with its own. This way, if a purchase was completed, Honey would claim the commission for itself, effectively stealing from the influencers they had paid to promote their product.

This hijacking occurred discreetly. A new tab would briefly open in the browser, executing the cookie switch before closing silently. Consumers and influencers were largely unaware this was occurring.

The magnitude of the theft

The transcripts reveal that the scale of this theft was likely massive, costing content creators millions of dollars. This was confirmed when YouTuber MegaLag contacted Honey for a recent video that has since gone viral, it also revealed that many influencers were unaware that this was even happening and for years.

2. Working against consumers: The coupon code manipulation

Not finding “the best” codes

Honey’s primary appeal was its promise to find the “best” coupons. However, Honey gave merchants the control to select which coupons should be applied by its extension, this worked in favour of the merchants and not the consumers. This enabled Honey to prioritise merchants over consumer savings.

If a store had multiple coupons available, like a 50% off code and a 5% off code, Honey was more likely to use the 5% code, or in some cases say that there are no available coupon codes. In many cases it wouldn’t even give the consumer a code, even if there were valid codes that the consumer could find themselves. This gave the impression that the consumer was getting the best deal possible, even when they were not.

Merchants could also choose which coupons were shown at all. If a merchant was running a promotion that they did not want Honey users to benefit from, Honey would not show the coupon, making consumers believe that there are no current codes.

Lack of transparency

These practices were concealed from the users. The extension never revealed that it was cherry-picking coupon codes or, that it wasn’t finding every available code. This lack of transparency fostered a false sense of security and trust.

Better Business Bureau inquiry

The Better Business Bureau actually started an inquiry into Honey based on these advertising claims. Honey immediately discontinued the claims for ‘business reasons’ and the case was dropped. This demonstrates that Honey was aware of the issues with their marketing.

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3. Prioritising merchants (and itself) above all

Merchant control over coupons

Honey provided its partner merchants with full control over which coupon codes would be made available to Honey users. This allowed them to limit discounts to boost their own profits, rather than prioritising savings for customers. The merchants could control the savings and which coupon codes would be available.

Honey Gold/PayPal Rewards scam

Honey even used its own rewards programme, Honey Gold (now PayPal Rewards) to further steal affiliate revenue. If there were no coupons for the consumer to use, Honey would pop up claiming they would give you a ‘portion of the commission money’ via points, it would then steal the affiliate commission for themselves and only give a portion of that to the consumer in the form of ‘points’.

Zero value provided, commission received

Honey provided absolutely zero value to the customer in this situation. They didn’t refer them to the store, or promote the product, they only stole the affiliate commission.

Why the backlash?

The realisation that Honey was engaging in these deceptive practices has sparked widespread outrage among consumers and influencers alike. The core issues at the heart of the Honey scandal were:

Betrayal of trust: Honey presented itself as a trustworthy advocate for consumers, whereas, they were clearly operating in their best interests and the merchants’ best interests. This perceived betrayal eroded the trust they had built up over years.

Financial exploitation: Influencers were not only having their commissions stolen, but were also unintentionally directing their fans towards a product that wasn’t actually offering the best deals, which damaged their reputation. Consumers, who had trusted Honey to save them money, were finding that they were not getting the maximum discount available.

Lack of transparency: Honey actively concealed its true operating procedures, making it very difficult to hold the company accountable.

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A warning about undue diligence

The Honey case is also a significant warning sign. It highlights the importance of due diligence, both for influencers when accepting sponsorship deals, and for consumers when engaging with any online service or product. Always do your own research.

The rebirth of middleman tactics: PI.org

But the problem is not resolved, a new application from one of the founders of Honey, named PI.org, aims to be a middleman between the consumer and advertisement revenue, in a manner similar to Honey. This is happening in a new, broader scale, affecting a range of online content creators across multiple platforms.

The future: A call for change

The Honey saga serves as a critical lesson in the power and perils of online commerce. Transparency, ethical practices, and a commitment to consumer well-being should be paramount.

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Looking for a better alternative: Try Coupert

If you are seeking a browser extension that can help you save money online but you’re concerned about the issues that have emerged with Honey, consider exploring Coupert as an alternative. Coupert also functions as a coupon finder and cashback programme, however, it differs from Honey in its methodology.

Here are some of Coupert’s key features:

Extensive coupon database: Coupert claims to have a vast and constantly updated database of coupons from retailers and brands.

Automatic coupon application: Similar to Honey, Coupert automatically tries coupon codes at checkout, saving you the effort of searching yourself.

Cashback offers: Coupert also offers a cashback programme at many retailers, which could supplement any coupon savings.

Price comparison tool: Coupert also features a price comparison tool, allowing you to ensure you’re getting the best deal online.

Coupert, unlike Honey, is not affiliated with PayPal, it also transparent about its earnings and business practices. They are transparent about their practices and how they generate revenue, allowing the user to make an informed decision.

The widespread disappointment and anger directed towards Honey are a direct result of its deceptive practices, lack of transparency, and exploitation of its users. While Honey initially promised savings and convenience, its business model ultimately betrayed its consumers, content creators, and ultimately themselves. The case serves as a crucial reminder that it is important to look deeper into the products that we trust, and to be skeptical of anything that sounds too good to be true.

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