Honey, a widely popular browser extension for online shopping, promises users “free money” by applying coupon codes at checkout. It has gained massive traction due to an aggressive marketing campaign that consisted of endorsements from influencers such as MrBeast and LinusTechTips. However, investigations reveal Honey’s practices aren’t transparent, raising questions about its business model.
One of Honey’s most controversial practices involves affiliate marketing, a system where influencers earn a commission for directing sales to online stores. It works by the consumer clicking an influencer’s affiliate link, which sets a cookie – a small block of data – in the consumer’s browser to track the referral and credit the influencer for the sale.
Compared to other affiliate marketing schemes, Honey differs by activating at checkout, searching for coupon codes and discreetly replacing the influencer’s cookie with its own, making it look like it was Honey’s referral instead of the influencer’s. Another controversial part is that even if there is no discount code found, Honey claims the commission as if there was a code, misleading influencers and consumers alike.
Honey’s promise to find every working coupon code is often unfulfilled, and the company is accused of withholding better coupon codes in favor of those approved by its partner businesses. Partner stores allegedly paid Honey to control which discounts are applied, prioritizing their profit margins over actual savings for customers. In some cases, Honey has even promoted expired coupons, meaning businesses too have lost revenue due to Honey’s practices.
Sponsoring over 5,000 YouTube videos with nearly 8 billion views total, Honey’s aggressive marketing strategy has, until recently, concealed its business practices in a scheme that benefits Honey at the expense of consumers and businesses. Honey is currently facing a class action lawsuit filed by YouTuber LegalEagle over the affiliate marketing controversy.
LinusTechTips is the third-most subscribed tech channel on YouTube with over 6,200 videos and 16 million subscribers. Linus used to be one of Honey’s biggest promoters before ending its partnership with the company in 2022 after discovering its affiliate marketing strategy. (Photo/Youtube)
