Episode 662: [EXPOSED] What You Need to Know About The Honey Scam

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A digital marketing bombshell explodes as Ralph and Lauren uncover the shocking truth about the Honey browser extension. Misattributed commissions, broken partnerships, and creators unknowingly caught in the crossfire—this scandal is shaking the influencer world to its core. With Lauren’s razor-sharp analysis and Ralph’s firsthand insights, they piece together a story of deception that could rewrite the rules of affiliate marketing. You won’t believe what’s happening behind the scenes!

Chapters:

  • 00:00:00 – Ralph and Lauren Have a Bombshell Revelation
  • 00:00:22 – The Scandal Exposed: What’s REALLY Happening Behind the Honey Browser Extension?
  • 00:01:38 – Honey’s Secrets: How They Pull Off This Controversial Move
  • 00:03:25 – Fallout: Creators and Affiliates Hit Hard—What’s at Stake?
  • 00:07:44 – Crossing the Line? Legal Battles and Ethical Dilemmas
  • 00:15:43 – A Marketing Reckoning: What Does This Mean for the Future of Influencers?
  • 00:20:36 – Wrapping Up the Drama: Takeaways

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Read the Transcript Below:

[EXPOSED] What You Need to Know About The Honey Scam

[EXPOSED] What You Need to Know About The Honey Scam

[00:00:00]

Ralph: Hello and welcome to the professional traffic podcast. This is your host, Ralph burns and the founder and CEO of tier 11, alongside

Lauren: Lauren E. Petrullo, founder of Mongoose Media.

Ralph: my amazing cohost. We’re a little bit punchy here late in the day because we are bringing you breaking news. Well, it’s not quite breaking, but it is our take on a pretty big scandal that happened in our space. Can you imagine scandal

Ralph: and scamming happening in the digital marketing or affiliate marketing space?

Ralph: Lauren, like what are the

Lauren: No, never.

Ralph: as a former affiliate who got screwed out of hundreds of thousands of dollars in commission, this one really pisses me off here today. So Lauren, can you explain exactly what happened with this little thing called [00:01:00] honey?

Lauren: Oh yeah. So honey, which is a company owned by PayPal, got, listed in a mega lag video on YouTube recently about the way that they have been taking last track attribution from all of the creators. Including many of which they, uh, have been paying to sponsor their content with like it’s, they’re stealing from the people they are paying to steal from.

Ralph: Paying the stealing from the people they’re paying to steal from, if I follow that. Okay. So explain that.

Lauren: It’s a lot. It’s like, take it in. honey is an extension that you add to your browser. Yep. See, you can tell

Ralph: things are upper right hand corner of your browser, the little jigsaw puzzle. It’s one of those.

Lauren: It’s one of those it’s free. And what prompted millions, I think it was like 17 million active users on the browser extension was the promise of if [00:02:00] you use honey, you will get the best coupon code available to you as a consumer. Sounds amazing. I’m gonna go shopping. I know I have a 10 percent discount because I signed up for the welcome.

Lauren: But if I use the honey chrome extension, I’ll be able to maybe find a 25 percent discount. Count me in

Ralph: So it searches the internet finds this always something it’s like, do you have a coupon discount code and then you go searching, this does it automatically for you.

Lauren: saves you time. In theory, you don’t have to search the Internet for the best code out there. You have a coupon clipping AI assistant in your right hand upper browser.

Ralph: Perfect.

Lauren: Ideally,

Ralph: far.

Lauren: Mm hmm. you would see how easy it was to install, how easy it was to get instant gratification if there was a code.

Lauren: And then the other part is if there wasn’t a code, you’d get this promise that we’ve scoured the internet. There is no better savings to apply for you. Feel confident in the purchase price you’re continuing on with.

Ralph: Thank [00:03:00] you, Mr. and Mrs. Honey for the savings.

Lauren: But like, uh,

Ralph: something is amiss here.

Lauren: yeah, Mark flyer had said, when you’re not paying for something, you are the product. Like he had used really good language in like 2021, when he was like trying to figure out like, how is honey making any money? If they’re not making money, you’re the reason they’re making money.

Lauren: So how they made money is when. You use their Chrome extension, whether or not you found a coupon code, Honey went in and wrote, inserted their affiliate code script because it’s at checkout, they inserted their affiliate code coupon script to automatically claim at minimum three to 5 percent commission on every single purchase.

Lauren: Done by their browser extension. And that was like in language that they had. If you’re working with Honey, the store has to do that. so

Ralph: And I’m sure everybody reads all those terms of [00:04:00] service. Of course, like we, all of us do last

Lauren: oh my, yeah. If you haven’t seen the film Jexy it’s a really good one where it talks about how, like it’s a play parody on Siri and how he doesn’t read the terms of service and it just makes fun of him the entire time. Roseburn voices it 10 out of 10 recommend, but this was taking last click attribution at the checkout.

Lauren: They didn’t drive traffic to the store. They didn’t influence you being interested in that product. They were just there at the last second, slipping in

Ralph: click attribution,

Lauren: Last click attribution to which they stole in theory, millions and millions and millions of dollars from the creators who sent original affiliate traffic to that store and where this becomes diabolical is when you think about creators who have partnerships with brands and they are renewing their contracts based off of attributable revenue, you can think of the thousands of creators [00:05:00] deals That were not renewed because assumed lack of attribution, despite a video they launch on YouTube, which is where this whole scandal came prevalent and why so many YouTubers who create these videos to promote affiliate sales as a large revenue stream.

Lauren: So many of these videos that were very successful videos in terms of views and comments were not successful for the brand in terms of attributable. Revenue. Well, if they were using the honey of Chrome extension, any possible sales were deleted, possible deals were not renewed, but most importantly, the obvious affiliate commission was stolen.

Ralph: right? Right out from under them. And you’re saying in the terms of service, which we’ll have to hunt this down and leave it in the show notes somewhere, somehow that the lesson in this is read the terms of service, because I’m sure it’s really long. Sorry. Oh,

Lauren: the lesson? I mean,

Lauren: every lawyer listening will

Lauren: say yes. [00:06:00] Never sign a

Lauren: deal.

Ralph: well, this point, I did a little list of this show, the two affiliate marketing myself included. The point is, is that this is totally sneaky and honey is owned by PayPal.

Lauren: Yes. I huge company that like, that’s how they got on the last click extension. I mean, you think about it, you also have the opportunity to pay with PayPal. And so in mega logs video and then follow up YouTube videos that I watch, you would see how like, then honey would offer the option to pay with PayPal.

Lauren: And even if there was the pay with PayPal button, they had this like another way to see, it was just like, how are all the different ways I can sneak in. slip in my phone number. So I think of like all the times that I’ve gone to a bar and I would find, I don’t know how this number got into my purse or my pocket.

Lauren: No, thank you. But A for effort. Cause I was impressed that it somehow got there and I didn’t realize I had been groped.

Ralph: That happens to you, huh?

Lauren: It used to. It used to. It hasn’t happened in a while. So

Ralph: well, like some of them,

Lauren: days when people [00:07:00] cared.

Ralph: yeah, well, It would, if people left notes now, now it’s like,

Lauren: No, why? You just go on an online app. Why would you waste time writing a note

Ralph: why would you write, why would you waste time writing so old school? So like 1990s, so this extension has been downloaded over 17 million times. this is not. Small extent. This is like a massive thing. And some of the affiliates are some of the biggest names that we know out there in the Uber world.

Ralph: Yeah.

Lauren: he’s done multiple videos.

Ralph: hundred percent. So he got scammed out of it too.

Lauren: Yeah, but so there was, in Megalav’s video, he said he found over a thousand videos on YouTube where creators were promoting honey. Likely it is that honey paid them. To make that sponsored content, So what’s interesting for me and I’m like watching all these responsive reactive videos I’m like you guys are talking about a brand you signed a contract with because you’re upset that you didn’t read the original contract of the brand that you were working with and i’m like Oh, [00:08:00] there’s gonna be a libel suit for sure coming because there are some brands that are like Screaming at honey, and i’m like you should check what agreement you have Because likely you’re in violation.

Lauren: So I was like, you’re going to complain about honey and honey’s going to come after you. I’m not encouraging that, but I’m just like, if you are listening and you worked with honey and they paid you specific, any brand that you work with, you need to be mindful that maybe if you had done your due diligence at the beginning, you’ll either say, if you want to work with a brand or not, but you have to be careful because you could be held liable for years after the.

Lauren: Completion of your heart. So there’s a lot going on. They paid people to do sponsored videos, but then there’s all the smaller creators that maybe didn’t get paid by honey and it didn’t matter because the Mr. Beast of the world, we’re getting people to add the honeycomb extension. And then you have a podcast or you have a small channel that’s like a nano or micro influencer.

Lauren: Someone who’s just getting traction and you’re taking money from them and they didn’t even know what honey is. That’s diabolical.

Ralph: Yeah, [00:09:00] that’s crazy. So my assumption is, that It was not just for PayPal purchases.

Lauren: Any purchases doing

Ralph: which would make sense, right? But it was everything.

Lauren: Every person and Ralph, it wasn’t just the purchases where they found. So if you’re like, okay, cool. Hey, honey found me a 40 percent discount. You know what, honey, thank you. You can get a small piece of that. Maybe if you’re

Ralph: sure.

Lauren: it, but took credit for the purchases where they didn’t even provide a discount just because you checked. you have to pay for looking in the mirror. You didn’t fix your makeup, but you still caught a glass. Pay up. Every person who’s ever walked by a window starting to count how many times they check themselves out while walking down the street across a bunch of retail store windows. Imagine having to pay every single time you snuck a glance.

Ralph: don’t do that. But anyway, if you did be very expensive for somebody who did do that, um,

Lauren: All right, party of one. You’re

Ralph: that part of your

Lauren: to admit it, Ralph.

Ralph: I’m just not admitting [00:10:00] it, of course. so Mr. Beast is pretty pissed off. I would imagine

Lauren: So I haven’t found any of his reactions. I like, I’ve

Ralph: Oh, no reaction

Ralph: videos from,

Lauren: has done many videos and my fear is that there are going to be some creators that are going to go after him, potentially because they trusted the brand Honey, assuming that his team would have done the due diligence. Now.

Lauren: That’s not his fault. If any creator was like, well, if Mr. Beast is doing, it must be a good company to work with. You cannot, that’s still not following like your own responsible and duties for it. But I imagine they’re going to be big creators that are going to get a lot of hit because they’re smaller creators, their fans follow them.

Lauren: It’s like, you know, when someone like bet on crypto and I believed you and now I hate you for life because I lost my money following your crypto advice. If you haven’t watched squid game, that was like one of the main. Characters points of contention, but that’s, oh, I think this is gonna unravel a lot, lot more.

Lauren: there’s a class action lawsuit that Sam legal legal has already filed, which [00:11:00] I’m like, Hey, good for him because He’s catching the wave of a very trending topic, really great guy met him at VidSummit one of the best conferences I can recommend for sure if you’re looking at YouTube stuff and so a lot of the creators at VidSummit like I imagine Honey is either going to have to like go out of business or sponsor everything at the next YouTube or VidCon or VidSummit type event because every YouTube creator was affected.

Ralph: Well, I mean, at least they’re backed by a company that has some money to be able to go after in a class action lawsuit. So there is that there might be some reparation damages here at the end of the

Lauren: maybe, but imagine what precedent that will set forth because PayPal’s team with Honey said that they haven’t done anything illegal.

Ralph: Well, of course, that’s the patented response though,

Ralph: to start off with, I mean, you’re not going to admit guilt for something like this. It has to be proven in court and they filed a lawsuit in California, so they’re probably going to get screwed. so people are saying that this is the biggest influencer scam of [00:12:00] all time. Would you agree with that?

Lauren: I think it affects way more like the argument of the ones before it, I would think are like supplement scams or like fire festival type of levels where people invested. I would

Lauren: even put

Ralph: acai colon cleanse from the late 2000s? I wouldn’t know anything about that, but that the FTC got involved in that the FTC might actually get involved in something like

Ralph: that.

Lauren: Oh, that. would be interesting.

Ralph: That would be interesting.

Lauren: They should. I mean, for me, I could argue that. I think this supersedes. Crypto and whatever that I say, you call it, whatever those are, in the sense that a company that generated money from less click attribution, I think all of the previous click attributed, Are what makes it so big with crypto. You knew you bought the crypto. You didn’t buy the crypto with fire festival. You bought the tickets or you didn’t buy the tickets with this. You could not, you might not have even heard of honey and you could have been affected. So I think this affects more individuals [00:13:00] than any other.

Lauren: Affiliate or influencer type of scam that’s happened before. And I think the consequences are even bigger because of the secondary tertiary, like the contracts that weren’t renewed, the money that wasn’t paid out, the impact of channels, all that kind of stuff.

Ralph: Yeah, it’s incredible. we’ll leave links in the show notes to this, but I did actually do a search for the FTC case and the SIA colon

Ralph: cleanse issue, which was, you were probably still in junior high school when this happened, but anyway, it was a big deal. And, uh, 11 affiliates, super affiliates basically lost everything.

Ralph: And we’re arrested, it was a big deal. Yeah. And they were getting, well, just to go into my sordid past, the, the thing to watch out for as you were waiting, whether or not you were going to be one of those people, cause I was a super affiliate for this particular thing, it was a blue letter from the FTC, which never actually came.

Ralph: Thank God, because I’d already gotten [00:14:00] investigated by the FDA. That’s a whole other thing. Maybe we should do that one after like a bottle of scotch at some point in time in 2025. The point is like, this is bordering on FTC territory because I mean, that was tens of millions, it wasn’t even real. Well, it’s probably hundreds of millions of dollars in damages.

Ralph: So we’ll look that one up and we’ll leave links in the show notes there, but this is something to be careful of. Like affiliates, I mean, it is your responsibility to read Terms of Service.

Ralph: Very hard to do though. And this is the risk. I mean, this is the risk at a large level. I think the folks that are primarily listening to the show or not, maybe at the Mr.

Ralph: Beast level, you might be listening to your own podcast at that point, the point is like, if you are, you need to divulge first off that you do have affiliate links, Secondly, you need to really do watch out for these investigate it as much as you possibly can, or avoid it altogether. Or what’s your takeaway from this whole thing?

Ralph: I guess that’s about [00:15:00] better.

Lauren: I think my takeaway, so for me, the heartbreaking pieces, those that didn’t work with honey got screwed. So it’s even if they didn’t, the people that partnered with the brands, if you’re a creator, you’re an influencer and you work with brands. Similarly, if you’re a brand and you work with creators and influencers, like you want to have easy to understand agreements, if you’re a brand, you better Put in your language that any creator that you pay money to make content for should not be able to do what a lot of these creators are doing about honey.

Lauren: I’m saying like protect yourself because I’m like, Oh, if you’re paying someone Own or control the conversation. If you’re getting paid by someone, be aware of what the company is and you do the due diligence. Like they’re like, Hey, this works. it seems like it’s a great product. I wouldn’t expect you to know how to look at the InSpec to see that the cookie is being overwritten, but there’s just a word of caution when something is free, if it’s too good to be true, it probably is, and that’s what I think is the biggest takeaway, but in 2025, [00:16:00] Influencer marketing, affiliate marketing, I think is coming for a bigger reckoning where you had already given your predictions like a couple weeks ago about nano and micro influencers having a big impact. I think brands listening to this are going to have to know that you have to proceed with sensitive individuals now because they’ve just gotten so badly burned, where maybe Ralph, I’m going to say more alignment with your prediction.

Lauren: Because micro and nano influencers are going to be pickier with the brands they work with. And there’s an opportunity there.

Ralph: Yeah. Well, I mean, if you’re a macro influencer or a mid tier or, somebody that’s higher up, you have to be suspect anyway. mean, the Kim kardashians of the world and the rocks of the world, like those are like huge, huge names that, are very few companies, unless you’re a mega brand or you’re an enterprise level company are going to interact with those types of folks.

Ralph: But the point is, is, nano influencers, micro influencers, your reputation is on the line here. So you have to be very, very [00:17:00] careful with this sort of stuff. And you do have to read, just don’t take money to take money because you could damage your reputation as a long term business model as well.

Ralph: But my prediction from a few shows ago was because those people typically don’t get hundreds of offers and are just shilling anything and everything. it’s an opportunity for brands to go after a very specific niche. Like I have a friend who’s in the, nano curcumin niche and another one who’s in, specifically, a certain type of algae supplement.

Ralph: there are micro and nano influencers. those are tiny niches, micro curcumin per se, but like influencer network, It’s all nano and micro. It’s like, how can I get some kind of traction with my business as I’m starting up? I’m like, go reach out to these people

Ralph: because not only do you split onesie Tuesday sales, you can have a personal relationship with them and that beauty of nano and [00:18:00] micro influencers, whereas soon as you get.

Ralph: Bigger, they’re getting a lot more action and are they really backers of the product? And secondarily, if you are in that market, you need to look at these types of arrangements very, very closely because your reputation can be on the line and then, all that trust and goodwill that you’ve built up with your audience can be taken away like that.

Ralph: So

Lauren: what’s between the macro and micro

Ralph: mid tier is 50 to a hundred thousand. Followers in that range and macro is, 50 to 500, or half a million. And then it’s 500, 000 to a million is macro, but basically anywhere like,

Ralph: um, yeah. And then there’s like the mega ones, which are way above that, which is above a

Lauren: I’m just thinking like the super mega influencers and a lot of those macro influencers that promote a company like Honey came after a lot of smaller brands, smaller influencers. And I [00:19:00] think you need to be aware of what you’re peddling, but there’s also, you have to be aware of the power of the publish because as soon as you hit publish again, your brand reputation, I think there can be a lot of influencers that creators are going to say, I trusted you because, and it’s going to damage and their micro and nano influences are going to then be reflective.

Lauren: It’s like you lost, it’s like the election, right? You lost Florida, you lost Ohio. And there are going to be some swing state level influencers that I think is going to have ramifications. So it’s just, I mean, word of caution,

Ralph: word

Lauren: read, read the terms and services.

Ralph: Read the terms of service, especially if you’re just starting out doing this, this should be a lesson for you that this is not the way to do it. But, I mean, like you said before, if it’s too good to be true, it usually is. if you think about it, it’s like, man, oh man, I wish I, had something that could automatically figure out like what that coupon code is to get me a 10 or 40 percent off or whatever it happens to be.

Ralph: I mean, it’s a great idea, but it sounds a little [00:20:00] bit too good to be true.

Lauren: Yeah. I’m curious as to what’s going to happen with the racquetins and the other Chrome extensions that offer value in advance. I’ve met some people that are making 10, 000 a day with their Chrome extensions because they have like a one 99 per month model, but I’m looking at the 27 Chrome extensions I have attached, most of them are connected Paid apps that I have.

Lauren: So it’s just an extension of a software that I’m using, but think there’s going to be a legislation that’s going to come in for this part of the internet. That’s been totally ignored. No one talks about Chrome extensions, apps are barely reviewed,

Ralph: Yeah. All right. Well, we’ll leave all the links in the show notes here for all this stuff for you to, at least investigate. And, some of the links to some of the stories that we did reference in today’s show, of course, wherever you’re listening to your podcasts, comment, like, subscribe. Over on Spotify now.

Ralph: Very cool. and leave a rating for us. You know, we will read that out on the air as we haven’t done in the last couple of weeks and we’re way overdue [00:21:00] Lauren, that’s your job, by the way, I’m just blaming you for not reading any of those. So,

Lauren: Understood. Noted.

Ralph: how we

Lauren: forward. I will come forward with all of the, so if you’re nicer about me in the comments, be ready. Yours is more likely to be

Ralph: That’s right. If you say nice things about Lauren in the comments, then we’ll read it out loud. Anyway, thank you so much for listening to today’s show. All of our links are over at perpetual traffic. com. Of course, you can watch this over at perpetual traffic. Channel on behalf of my awesome cohost, Lauren E.

Ralph: Petrullo, MBA,

Lauren: on

Ralph: girl with blonde hair emoji

Lauren: her laptop.

Ralph: on her laptop working away.

Lauren: Currently, red is the earring she’s wearing.

Ralph: That’s true. It’s our best outro ever. All right. Ciao. I’m going to say it for you because you’re laughing too hard. See you on the next show. See ya.

[00:22:00]

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