Podcast Summary: The Journal – "Why Influencers Say Honey Is Stealing Their Money"
Episode Overview The Journal, a collaborative production by The Wall Street Journal and Gimlet, delves into critical stories surrounding money, business, and power. Hosted by Kate Linebaugh, Ryan Knutson, and Jessica Mendoza, this episode titled "Why Influencers Say Honey Is Stealing Their Money," released on February 20, 2025, explores the contentious relationship between online influencers and the browser extension service, Honey.
Introduction to the Controversy Jessica Mendoza opens the discussion by introducing a significant controversy involving Honey and its impact on YouTube creators' earnings.
Key Characters:
- Dylan Russell (Yub): A Texas-based YouTuber with 1.6 million subscribers who primarily earns through ad revenues and merchandise.
- Devin Stone (Legal Eagle): A lawyer and YouTuber with over 3.5 million subscribers, specializing in explaining legal matters related to current events and pop culture.
Honey’s Business Model and Partnership with Influencers Jessica Mendoza provides an overview of Honey, a browser extension launched in 2012, which assists users in finding promo codes and discounts across over 3,000 websites. Owned by PayPal since its acquisition in 2019 for approximately $4 billion, Honey generates revenue through commissions on facilitated purchases.
Notable Quote:
- Dylan Russell (Yub) [01:04]: “That's where I make probably 95% of my income. My eggs are definitely all in that basket.”
Honey’s partnership with influencers has been widespread, with notable YouTubers like Mr. Beast and PewDiePie promoting the service. Yub recounts his collaboration with Honey, highlighting how these sponsorships are integrated into his content.
Notable Quote:
- Dylan Russell (Yub) [07:02]: “Picture like there's a 15 minute long gaming video, and then five minutes in, I'm gonna be like, so sorry, gotta talk about the sponsor real quick.”
The Accusations Against Honey In December of the previous year, YouTuber Megalag released a video accusing Honey of deceitfully redirecting affiliate commissions away from creators. Megalag’s allegations suggest that Honey overrides the original affiliate links provided by creators, thereby capturing the commissions meant for them.
Notable Quote:
- Unnamed YouTuber [03:09]: “The Honey influencer scam turned out to be a big scam, allegedly. I can't believe it.”
Jessica Mendoza details how Honey’s actions contradict standard affiliate marketing practices, where the last click typically receives the commission. Honey claims that their actions provide value by ensuring shoppers receive the best prices, but this has been contested by numerous creators.
Investigative Findings and Demonstrations Jessica Mendoza and her producer, Alan Rodriguez Espinosa, conducted their own investigation by replicating the process described by Megalag. They found that Honey indeed replaced the original affiliate cookies with its own, thereby diverting potential commissions, even in the absence of additional discounts.
Notable Quote:
- Dylan Russell (Yub) [10:24]: “...Honey gets the credit for that sale. If it pops up and it's like, just so you know, there's no coupon codes on this site and you click okay, got it. They still take the affiliate link for that sale.”
These findings validate the concerns raised by multiple influencers, leading to widespread outrage within the YouTube community.
Legal Actions and Industry Response Devin Stone, known as Legal Eagle, spearheaded the legal battle against Honey by filing a class action lawsuit in California. The lawsuit alleges that Honey's practices constitute intentional interference with contractual relations and violation of consumer protection laws. Over 1,000 creators have expressed interest in joining the lawsuit.
Notable Quote:
- Devin Stone [21:33]: “I've got my sleeves rolled up. I've got my tie loosened. We're going at it.”
Other shopping extensions like Capital One Shopping and Microsoft Shopping have faced similar lawsuits, though they have publicly denied the allegations.
Industry Standards and Ethical Considerations Julie Van Allen, Chief Revenue Officer of Rakuten Rewards, explains the concept of "last click attribution," which is the standard method in affiliate marketing. This practice ensures that the final affiliate interacting with the consumer before a purchase receives the commission.
Notable Quote:
- Julie Van Allen [17:22]: “Last click attribution is the gold standard for measurement and affiliate.”
Van Allen emphasizes the importance of "standing down," a practice where once an affiliate link is clicked, other extensions or affiliates refrain from claiming the commission for that transaction. This mutual respect maintains the integrity of affiliate relationships and ensures creators receive their due credit.
Implications for the Affiliate Marketing Industry The controversy surrounding Honey has sparked a broader discussion about the ethical responsibilities of browser extensions and affiliate marketers. While some industry insiders question the ethics of overriding affiliate links, others argue that Honey is merely adhering to established industry practices.
Notable Quote:
- Devin Stone [15:02]: “We think it is violative of several different laws... they're taking advantage of that instead.”
The legal battles may set precedents that could reshape how affiliate marketing operates, potentially leading to more transparent and fair practices that prioritize creators' earnings.
Conclusion and Future Outlook As the lawsuits proceed, the outcome remains uncertain. Devin Stone expresses commitment to the long legal fight, aiming to restore rightful earnings to creators and uphold ethical standards within the industry.
Notable Quote:
- Devin Stone [21:35]: “Yes, well, for one thing, I think it's the right thing to do... it's money that should go back to the creators.”
The episode concludes with a reflection on the potential long-term impacts on both influencers and the broader affiliate marketing ecosystem, highlighting the ongoing struggle between creators and corporate practices.
Final Notes This episode of The Journal provides an in-depth examination of the friction between influencers and affiliate marketing platforms, using Honey's controversial practices as a case study. Through interviews, investigative reporting, and expert insights, listeners gain a comprehensive understanding of the complexities and stakes involved in the digital economy.