Why creators’ pushback against Honey is about more than skimmed affiliate revenue

Since December, the Honey scandal has become something of a cause célèbre within the YouTube community, in part due to the fact that prominent creators such as James “MrBeast” Donaldson and Marques “MKBHD” Brownlee had previously promoted the service in sponsored videos. On Jan. 2, legal YouTubers such as Devin “LegalEagle” Stone initiated a class-action lawsuit against the company.

“It’s the pure irony of the fact that the biggest creators on YouTube — the exact ones who were promoting it — were the ones that were hurt most by what Honey is doing,” said YouTuber Bennett “@moneymindnews” Santora. “It’s something that everyone’s seen promoted by their favorite YouTubers.”

Affiliate marketing is a significant revenue stream for many creators, and although it’s unclear exactly how much affiliate revenue Honey is said to have skimmed from creators over the years, some YouTubers’ estimates are in the millions. But Stone’s class-action lawsuit against the company is claiming that the true monetary damage of Honey’s scheme could be in the billions due to its impact on creators’ future brand partnership business.

Honey’s business model relies on the practice of last click attribution, which gives all credit for conversions such as affiliate-link clicks to the final touchpoint of a consumer’s journey — in this case, Honey, rather than the creator or influencer whose affiliate link introduced the consumer to the product. Honey has also made it impossible for creators to know exactly how many sales truly come from their affiliate links, damaging the metrics that creators often share with marketers to score direct brand deals.

“In today’s data-driven era, one of the key benefits of working with influencers is their ability to deliver targeted insights and measurable results,” said Niki Albon, head of creative for agency Cherry Pick Talent. “If such practices occur, they risk skewing results, which could harm creators by diminishing their perceived value. This, in turn, could result in fewer opportunities and lost earnings as brands base future decisions on these flawed metrics.”

Although Honey’s business practices impact creators of all sizes, it’s the smaller-to-mid-sized creators who rely on affiliate marketing for a large chunk of their revenue who say they are most significantly affected. YouTuber Tyler “Antenna Man” Kleinle, for example, told Digiday that affiliate links account for roughly half of the income from his channel. 

For Kleinle, who is participating in the ongoing class-action lawsuit, Honey’s skimming of affiliate revenue was certainly harmful — but the YouTuber believes he may have experienced a deeper harm due to the potential effect of his depressed affiliate marketing metrics on his direct brand partnerships.

“That actually has a higher impact, because a lot of the companies pay a higher affiliate commission than Amazon does,” said Kleinle, who estimated that his potential losses were “at least in the hundreds, if not thousands, of dollars.” “If Honey is taking the affiliate commission from that, they are essentially taking more money.”

Of the original YouTubers who promoted Honey and were directly sponsored by the company, some have used the scandal as a content opportunity, publishing mea culpas or explainer videos, while others have remained silent, possibly due to the risk of legal retribution by their former sponsor. Regardless, MegaLag’s video essay appears to have turned the public opinion of the YouTube community squarely against Honey.

“For all we know, it could be breaching their contract with Honey to speak out against it,” said Dylan “YuB” Russell, a formerly Honey-sponsored YouTuber who was featured in MegaLag’s video. “I was worried about that making my own video; what if I actually get in legal trouble by saying ‘here’s how to uninstall Honey’ in my video after doing a brand deal with them?”