The Worst Sponsor Scam In YouTube History | Internet Anarchist

0:00When you need to build up your team to handle the growing chaos at work, use Indeed Sponsored Jobs. It gives your job post the boost it needs to be seen and helps reach people with the right skills, certifications, and more. Spend less time searching and more time actually interviewing candidates who check all your boxes. Listeners of this show will get a $75 sponsor job credit at Indeed.com slash podcast. That's Indeed.com slash podcast, terms and conditions apply. Need a hiring hero? This is a job for Indeed Sponsored Jobs. Propel Fitness Water With Gatorade Electrolites, Zero Sugar, and Vitamins, Propel hydrates better than water to help you get the most out of your workout and get back to your best self. What propels you? Propel with Gatorade Electrolites Visible puts unlimited 5G data and hotspot in the palm of your hand, powered by Verizon's 5G network, with no contract holding you back. And for a limited time, you can get visible for just $19 a month for 12 months when you use promo code Save6.

1:01All the features of Big Wireless Service for half the cost. Tap the banner to switch today. Terms apply, Standard Rate applies at month 13, see visible.com for plan features and network management details. What would make a company the worst sponsoring YouTube history? Is it falsely advertising a product? Is it taking advantage of consumers' trust? Or perhaps it's secretly diverting the revenue from the creator they sponsor. Unfortunately with Honey, it's all of the above. As the once beloved sponsor has been caught up in a sudden whirlwind of controversy that is not only exposed to brains through nature, but also completely destroyed its public perception. Yeah, I hate to break it to you, but your favourite influences sold you alive. I believe the scam has likely cost content creators millions of dollars. Hi, I'm the internet anarchist. I create weekly YouTube documentaries and today we'll be diving headfirst into the sudden downfall of one of YouTube's most popular sponsors, Honey. We'll examine how the company shady practices work, exposed the backlash from the YouTube

2:03community and why this feels like it's only the start of the company's plans to extort the YouTube community. To truly grasp Honey's devastating downfall, we must understand what the company promised customers and how the company became a trusted sponsor on the platform. According to their website, Honey is a free browser extension that helps users save money by finding coupon codes during checkout. In addition to this, Honey also rewards users with gift cards for purchasing specific products. On the surface, the extension seems like a win-win situation for consumers. Users could potentially save money on their purchases, and if they didn't, they could at least earn some gift cards. Honey would take advantage of this positive perspective in its marketing and enlist some of the most prominent creators on YouTube to promote its product to fans.

3:11They seemingly harmless business model and the endorsement of hundreds of trusted creators, Honey garnered millions of active users and even a $4 billion acquisition from PayPal, although there were certain creators that had their suspicions about the start-ups operations. My gut tells me that nothing in life is free. So where's all these savings coming from? And like the money that people get from Honey, I don't trust it. They push so much advertising. They push so much advertising on YouTube. They do brand deals with other YouTubers. I think they've even offered me. And I said no, because I just don't trust Honey. For a while, almost everyone viewed Honey as an innovative startup that skillfully leveraged influence a marketing to rise through the ranks and create a billion dollar business. However, what goes up must come down, as the sinister secrets of Honey's success were about to be exposed in the worst way possible.

4:12By the 22nd of December 2024, the creator Megalag would highlight Honey's shady aside, with a video titled Exposing the Honey Influencer Scam. Honey hasn't just been scamming you, the consumer, they've also been stealing money from influencers, including the very ones they pay to promote their product. And I'm not just talking about a few bucks it. I believe the scam has likely cost content creators millions of dollars. To illustrate how Sunny subtly manipulates online purchases to divert revenue away from creators, Megal would first compare what should happen when viewers use Honey. When you click on a affiliate link and buy something, the influencer who promoted the product earns a commission for referring you to that store. So you add the product to your cart, get to the checkout page, and hello! Honey says they found you 10 coupon codes. This is what actually happens when Honey is involved in the sale. Well, once Honey popped up, what would happen to Linus' affiliate cookie after we clicked applied discounts? You see that? Honey came in, removed Linus' affiliate cookie, and replaced it with their own, claiming

5:15credit for the sale, and pocketing the commission money for themselves. If you'd think that a company outed for stealing from the creators endorsing their product, would at least show some remorse. But that wasn't the case with Honey. I'm questioned about their shady sales tactics. Honey proudly stated that it was part of the process for them to receive credit for any purchase involving their extension. So I figured screw it. I'll reach out to Honey and ask them directly. And sure enough, they came back to me with the following. If Honey is activated and is the last program used while shopping on a site, it is likely Honey will receive credit for the purchase. I was right. And just like that, my investigation into Honey began. Anyone looking at this situation logically could tell that Honey had no claim in any of the commission since they neither directed customers to the product nor facilitated the purchase. What makes this even more scummy is how this practice was never disclosed in any of their promotional material despite it directly harming the creators and consumers who made Honey what it isn't the first place. Sadly, this wasn't Honey's only method of exploiting its users, as Megalag would showcase

6:20two other examples of the company's snatching commissions. And it was through the Honey Gold rewards program. Made two separate purchases. For the first, I activated Honey Gold. And sure enough, you can see my affiliate cookie was replaced with Honey's. And for the second, I didn't activate Honey Gold. As expected, I was awarded a $35 commission for the sale where Honey Gold wasn't activated and received nothing when Honey Gold was activated. For the first time, I experienced Honey poaching my own affiliate commission. The other occurred whenever users clicked on the Honey extension, regardless of whether a coupon code was offered. Eventually you clicked the Got it button to get rid of the annoying dancing coin and whoa, what's that? PayPal takes the sale. Why? Because you married the Chalk commission! Considering the many influences Honey had worked with and the vast amount of revenue they were siphoned. When you need to build up your team to handle the growing chaos at work, use indeed sponsor jobs.

7:20Use your job post the boost it needs to be seen and helps reach people with the right skills, certifications, and more. Spend less time searching and more time actually interviewing candidates who check all your boxes. Listeners of this show will get a $75 sponsor job credit at Indeed.com slash podcast. That's Indeed.com slash podcast, terms and conditions apply. Need a hiring hero? This is a job for Indeed sponsor jobs. PayPal Fitness Water With Gatorade Electrolites, Zero Sugar, and Vitamins, Propel hydrates better than water to help you get the most out of your workout and get back to your best self. What propels you? Propel with Gatorade Electrolites Visible puts unlimited 5G data in hotspot in the palm of your hand, powered by Verizon's 5G network, with no contract holding you back. And for a limited time, you can get visible for just $19 a month for 12 months when you use promo code Save6. All the features of Big Wireless Service for half the cost. Tap the banner to switch today.

8:20Terms apply. Standard rate applies at month 13. See visible.com for plan features and network management details. Fening, it was likely that some of them would notice the issue. Fortunately, one did, but the problem would sadly go unpublished. Back in 2020, someone sounded the alarm, but it was ultimately ignored. However, in 2022, a different user noticed that LMG were no longer promoting Honey and asked the team if they had been dropped as a sponsor. To which one of Linus' employees responded with, we ended the partnership with Honey due to the way their service interacted with affiliate links. Essentially, if someone clicked on an affiliate link and then they used Honey and searched for a deal, Honey will override that tracking link even if they don't find you a deal. That didn't drive with us, so we ended the partnership. Only though Honey was essentially stealing from everyone they came in contact with, you think that at least they true to the premise of finding good coupon codes, right? Unfortunately, not even that was possible with Honey. Another oddity was that Honey would often only find me Honey branded coupon codes such

9:24as Honey 5 or Honey 10. Why would a store only have Honey branded coupon codes? Kind of weird, right? But the biggest red flag was that when I tried submitting the better coupon codes I had found, Honey wasn't adding them to their database. So why not? Well, eventually I figured out what was going on. It turns out that one of the key benefits for stores partnering with Honey is that they had given full control of the which coupon codes go live on the platform. If any at all. To further illustrate to this, MegaLag would highlight an instance of a Honey employee openly acknowledging the fact that they restrict the kind of discounts consumers get. What would you say to any brand that is considered working with Honey but hasn't yet? I would say missing out and converting customers like as I before, Genza is super discount savvy. You can't ignore the fact that they will hunt for like discount codes and they might find a better deal with Honey. You can also control the discount code percentage, which means like they will potentially find a higher discount code on the internet. In literally, let's you control like the customer journey, convert and control like they

10:27discount code percentage as well. MegaLag's video garnered over 11 million views and sparked a massive uproar on the YouTube community as both viewers and creators expressed their disdain for Honey's scummy practices. With a comment from Coffeezilla reading, this is insanely predatory, great investigation. Every YouTuber who promoted this should make updates to help consumers what is actually under the hood. We've been sold alive. It's not the best deal and it's stealing from people who actually bring traffic. MegaLag's comment section wasn't the only place used to express their feelings about Honey's betrayal, as several creators began uploading videos announcing the brand. Honey's stretching everyone's holes here, both the consumer who downloads Honey as well as the creator that promoted the Honey. That does include me. I have worked with Honey in the past because I was an avid Honey user. Seems like a pretty simple, effective product. It just finds coupons that check out to save a little money. I didn't think there was anything nefarious going on under the hood, but it turns out couldn't have been more wrong. Although this was the first time the wide YouTube community noticed Honey's scam, it wasn't

11:31the first time YouTubers reported it. Back in July of 2020, a credit named Original MCW uploaded a video titled Five Reasons at the Honey app is a scam, which explored the company's dubious marketing claims. Now if you've clicked through to buy something from your favourite blog, or from a review website like which underwear for the bigger penised man, yeah ladies. Once you get to the stage where you're back to actually buy it in the checkout and the Honey extension has gone off to look for the best discount codes. And then it comes back probably as usual it hasn't found you any discount codes, but it has done. And this is crucial. It has replaced the cookie that had the affiliate information with their own. So when you do buy something from that website, join Honey, get all the money. MCW also highlighted several other issues with Honey, such as lackluster discounts, false marketing claims, and mismanaging consumer data. Even Amazon, yes Amazon. Even they have warned their customers about joining Honey.

12:33To keep your data private and secure, uninstall this extension immediately. We are warning customers about browse extensions that collect personal shopping data without their knowledge or consent. Even though MCW's coverage wasn't as damning as mega lags, it had very similar points and showed just how deep honey's floors ran. However, one can only imagine how differently things would have turned out if creators and consumers had caught onto the scam earlier. Thankfully, users can now hold Honey accountable and spread awareness to the actual function of their extension, with the reviews of the product being completely annihilated. While Honey will never be able to scam users again, the individuals behind the extension have already moved on to an even more dubious product that directly goes after creators' revenue. A few weeks before Honey was officially debunked, the creator of Honey, Brian Hudson, launched the Pi ad blocker, which promised users the opportunity to own cash rewards from ads they viewed. Similar to his previous extension, Pi would feature a cashback and coupon search feature, while it's unclear if this extension has the same issues as Honey that hasn't stopped

13:36users from flagging it as a scam. With reviews reading, scam from the creators of Honey. Scam. Scammers not safe. Shifting focus back to the ad blocker side of Pi, ad a first glance, it seems like you're run-of-the-mill ad blocker, but a closer look yields something more disturbing. Looking at how the rewards program is structured, it quickly becomes apparent that Pi is trying to exclude creators and websites from the ad-viewing process. They do this by blocking native ads on a website or YouTube channel, and then get their users to view only their ads, thereby pocketing the ad revenue from content they didn't create, a scheme that they proudly showcase in all of their marketing material. This is the only ad blocker I've ever used that works on YouTube, Twitch, and Spotify. This is Pi, it's a free Chrome extension that blocks ads everywhere you go online, and don't worry, it won't download a bunch of... When you need to build up your team to handle the growing chaos at work, use Indeed Sponsored Jobs. It gives your job post the boost it needs to be seen, and helps reach people with the

14:37right skills, certifications, and more. Spend less time searching, and more time actually interviewing candidates who check all your boxes. The partners of this show will get a $75 Sponsored Job Credit at Indeed.com slash podcast. That's Indeed.com slash podcast, terms and conditions apply. Need a hiring hero? This is a job for Indeed Sponsored Jobs. Propel Fitness Water With Gatorade Electrolites, Zero Sugar, and Vitamins, Propel hydrates Better Than Water to help you get the most out of your workout and get back to your best self. What propels you? Propel with Gatorade Electrolites Visible puts unlimited 5G data and hotspot in the palm of your hand, powered by Verizon's 5G network, with no contract holding you back. And for a limited time, you can get visible for just $19 a month for 12 months when you use promo code SAVE6. All the features of Big Wireless Service for half the cost. Tap the banner to switch today. Terms apply, standard rate applies at month 13, see visible.com for plan features and network

15:39management details. On to your computer like other ad blockers. Pi is a trusted LA based company that's actually founded by one of the creators of Honey. The coolest part is that if you decide you do want to see ads, Pi will literally pay you for seeing them. Like, I made money just from this Google search. Good luck finding another ad blocker that does that. Speaking of things other ad blockers don't do, Pi also has a visual note that lets you watch your ads disappear and see how much space you're saving. So if you want this to be the last ad you ever see, get Pi for free right now. Essentially, Pi wants to hijack the revenue from every online ad at the cost of sharing a tiny fraction with users. It is an appealing proposition for online users, but not for creators, since the extension would effectively be stealing from them. That being said, you'd think such a detrimental extension would have no direct association with the creators they plan to rob. But you'd be wrong. Some time ago, Pi reached out to our channel through sponsor us and shared some very peculiar influencer guidelines. While the document contained the standard requirements of showcasing the extension and

16:42its features in a positive light, some details stood out to me. For example, the extension only lets users earn from specific ads, which implies that Pi would partner with and promote certain brands to its users, potentially pocketing a majority of the ad revenue while leaving everyone else with peanuts. The next point I noticed in the brief was their Pi creator network, which reads, Pi will whiter-list any creator as a part of our partnership for 12 months, and will continue to show your ads on YouTube when users are opted into rewards for ads. Pi users will earn revenue when they see ads from creators in our network. This is highly concerning for three reasons. One, the partnership's 12 month time frame means that the creators must be perpetually linked with Pi in order to keep ads on their channel. Two, it's unclear if the ads served on whiter-listed channels originate from YouTube or Pi. And three, there's no mention of what ad rates will be for creators, or if it'll be subject to change in the future. Joining their network leaves a portion of the creators revenue at Pi's mercy, and there's no telling what the company will do with that power, especially when you consider what

17:45they're already trying to do. The final thing of note in the brief is that the creators of Pi must admit that the app can't block ads on every platform, despite their ad campaigns stating otherwise. Reading, while we cannot block all mobile ads, i.e. ads in other apps outside of Safari, Instagram, TikTok, etc. we can block all ads within Safari mobile app. We don't block ads on YouTube app, only Safari. So just like its predecessor, honey, Pi full short of its key marketing premise, while trying to manipulate creators into propagating its false claims. By now, it's apparent that Pi's mission isn't to provide users with a better online experience. It's a better their bottom line at the expense of everyone else, whether it's taking unowned commissions or devoting ad revenue. Honey and Pi are businesses built on the idea of reaping profits from the hard work of others, while putting up the facade of being the user's best interest. Thankfully, it doesn't seem like that'll be a profitable business model for much longer, with Honey's lies laid bare one could only imagine that face some legal repercussions.

18:45But that might not be the case. The products terms and conditions include a class action waiver restricting legal action against them. It's unclear whether this applies to the creators they've worked with, but that hasn't stopped a few of them from trying. If an individual person did this to another person, in most states it would be classified as a crime, and yet Honey will likely never answer for this aspect of their alleged scheme. But there is a potential silver lining, which is that my lawsuit contains a request for an injunction that, if granted, would prevent Honey from continuing to do just these sorts of things. I partnered with Attorney Tom and Legal Eagle and some other great class action lawyers to pursue Honey as much as we can. Which ever way the lawsuit goes, it's safe to say that Honey and its successor, Pi, have left a bad taste in everyone's mouth that will be discussed for years to come. If you enjoyed this video, click the video on screen.