There are a few lines that usually hold up to a fair bit of scrutiny in tech. “If it’s free, you’re the product” and “if it seems too good to be true, it probably is”. A recent YouTube video from MegaLag confirms this is the case for Honey. Honey is a “free” web browser extension (Chrome extension, Firefox extension etc) widely promoted by influencers promising discount codes for you, the consumer. But MegaLag’s investigations have uncovered a raft of shady practices which are likely costing you money.
What is Honey (the web browser extension)?
Honey was founded in 2012 before it got leaked on Reddit and went viral. By 2014 the extension had experienced explosive growth with over 900,000 users already using it. It’s understandable why.
Online shopping had also been growing during this period and discount codes were emerging as a powerful level for online stores to pull. Discount codes simply let companies give generic or personalised discounts to customers, encouraging them to make a purchase.
The promise to customers was so simple. Install Honey and make sure you’re always getting the best deal. Honey promised that it would automatically apply discount codes even if you missed them. Something that’s happened to me before and something which is extremely annoying.
Honey went on to raise millions of dollars in funding as the potential for the platform grew. Potential that PayPal spotted, buying the company in 2020 for $4 billion, renaming the app PayPal Honey.
Why Honey is Bad for Consumers
While the promise of Honey is simple, in practice, the extension was actually misleading customers, both to the benefit of businesses and Honey. This is what MegaLag uncovered in his investigations.
Much of the promotion around PayPal Honey centred on you always ensuring you get the best deal just by having the extension installed. Honey promised to always have the latest and best discount codes, so why bother scouring the internet for them yourself.
Well, I’ve worked in many ecommerce companies and I can tell you that discount codes cause as many problems as they solve. Every single time a discount code is created, the same conversation takes place.
“Okay, we’re creating a 50% off code for existing customers, but what happens if this leaks on Reddit?”.
The idea of PayPal Honey is that should a discount code leak and be working, Honey should pick it up and make sure any customer with the extension gets that discount, even if the company selling didn’t really intent for that to happen.
But then PayPal Honey started partnering with businesses. This means businesses would offer Honey specific discounts, like “HONEY10” to give 10% off. MegaLag’s video shows instances where the Honey extension would promote the 10% off discount and ignore discount codes that offered greater savings.
Suddenly, the extension that promised to save you money was now costing you money by lulling you into a false sense of security and misleading you with lesser discounts.
Influencers Also Getting Caught Out By Honey
A large proportion of MegaLag’s investigation doesn’t focus on consumers at all. It actually focuses on influencers and specifically influencers that have promoted Honey like Linus Tech Tips and Marques Brownlee.
In a fairly technical deep dive, MegaLag shows us how Honey steals the credit for sales from influencers and platforms that use affiliate marketing.
Affiliate marketing is really common, we use it here at Goosed. Basically, when we like a product, we will recommend some places you can buy it. If one of those places you can buy from offers affiliate programs, we’ll use a special link to the product on that site. You don’t pay anything extra, but this link means we get a tiny percentage of the sale in return for sending you over to that shop.
We haven’t noticed anything specifically ourselves, but what MegaLag shows in his video is rather shocking. When customers click affiliate links from a YouTube or a media outlet like ourselves, and they have the Honey extension installed, through some programming magic in the background, Honey reattributes the sale to itself, taking the credit from the influencer or platform that did all the work.
I’m not going into the depths of this element even though it is the crux of MegaLag’s video. I’m not on a personal vendetta here to protect a revenue channel for Goosed. I’m more annoyed by how Honey is misleading consumers with lowball discount codes to protect businesses.
Should You Uninstall Honey?
I have just uninstalled Honey, but I’ll admit I was probably going to uninstall it anyway. It rarely comes up with any actual discount codes for me and is a waste of space on my browser toolbar. But this video was the final straw. When good ideas get taken over by big companies for big money, the consumer rarely benefits.
Honey, at in it’s youth, was a great idea. But PayPal Honey has grown into a trojan horse. A trojan horse where I’m not entirely sure who is losing out most from businesses, influencers and other outlets, or you, the consumer.
The only thing I know for sure is that if you want to get the best deals all the time, you are better off doing some research instead of relying on just Honey.
MegaLag’s Honey Video
I highly recommend watching MegaLag’s full video on this. It’s a little over 20 minutes, but it will show you the shady side of online businesses. As I opened with, if something seems too good to be true, your defences should prick up.
Also, in one part of the video we see MrWhoseTheBoss promoting Honey while wearing a Huel t-shirt. Double whammy of warning!
If you enjoyed his video and appreciate his investigative journalism, consider joining MegaLag’s Patreon.
