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How G Fuel's Toxic Work Environment Made Energy Drink Brand Influencer Marketers Jump

Gaming and esports energy drink company G Fuel fired seven talent managers on June 16, and a day later, five of them contacted HR to report that their CEO used offensive language to describe current and former Employees during a meeting.

According to former G Fuel employees, these comments were just the straw that broke the camel’s back after months of bad behavior by executives that included abusive management, crony hiring practices and misconduct .

These claims are supported by 11 current or former employees of the company who spoke to Digiday, many of whom requested anonymity for fear of speaking out could hinder their future employment opportunities in the relatively isolated esports industry. Asked for comment, G Fuel spokesman Mark Botnick told Digiday that the employees were fired for “underperformance” as part of the division’s restructuring. Some employees received severance pay for six weeks. (Editor’s note: This Digiday reporter wrote for G Fuel as a freelancer from 2019 to 2020.) Their departure had a notable knock-on effect on G Fuel’s business: News After it was made public, more than 75 co-creators — who were paid a monthly fee or commission by G Fuel in exchange for promoting products — terminated their affiliations with G Fuel in protest of the brand’s treatment of employees they viewed as the company’s face. “My partner manager is my G Fuel guy,” said anchor Nathan Kays Burden, who ended his partnership with G Fuel following the personnel change. “How I see G Fuel and how I see my partner manager.” In the past, some esports companies have managed to weather controversies without taking a major hit to the bottom line. However, with the exit of talent managers, the influx of negative sentiment towards G Fuel could damage the brand, especially given the nature of this tight-knit industry in which consumer perceptions of brands increasingly at the mercy of prominent individual influencers. Some observers have linked the anachronistic marketing to the company’s culture – pointing out that around the same time the contract was terminated, G Fuel and Marvel Studios Thor had launched a “love and Thunder”, a film that emphasizes women’s empowerment. Director of Strategy Michael Baggs said: “The product launch is now in the feed, with streaming partners distancing themselves from G Fuel and sharing screenshots of how they got banned , because they asked what they should do now because their female partner manager has been fired.” on social media agency The Social Element. “In the future, as brands look for partners to represent and reach out to gaming communities, it’s impossible not to look at the current conversations around G Fuel and ask themselves if they’re actually reaching out to those communities in a positive way.” On 7 Fired Talent Three of the managers are women, and of the more than 75 co-creators who chose to break with G Fuel, at least 34 are women. Founded in 2012, G Fuel is headquartered in the small Long Island hamlet of Hauppauge, New York, although most employees currently work from home. The privately-held beverage company has been controversial in the past: It promoted YouTube anchor Daniel “Keemstar” Keem, who has been accused of racism and misogyny on multiple occasions and has been one of its main partners for years, only to He was fired only after he was fired. Accused of using another YouTuber to kill himself in 2020; the company abandoned an NFT project earlier this year after fans complained about its high carbon footprint. “Keemstar’s behavior is inconsistent with our values,” Botnick said. “This partnership was terminated by mutual agreement.” In 2019, G Fuel’s own CEO Cliff Morgan wrote a tweet Wen, came under fire after describing a prominent Twitch streamer as “lying [expletive]”. Each time, G Fuel had little, if any, impact on its bottom line — at least by its own numbers. The company reported six consecutive years of revenue growth between 2016 and 2021, and a 119% increase between 2017 and 2019. This time, the brand feels less untouchable. G Fuel has not shared any of its revenue figures publicly since the March 2021 press release linked above. Notable creator partners, including NFL quarterback Kurt Benkert, are leaving G Fuel after learning about the fired employees. As a result, the company’s total social media followers, which form the cornerstone of G Fuel’s marketing strategy, have fallen by more than 50 million GEEIQ in recent months, according to the gaming and esports data platform. “The data shows that their presence in gaming and esports is decreasing,” said Charles Hambro, CEO of GEEIQ, “as their partnership has declined over the past six months.” G Fuel still has far more social following than competitors like Fusion Energy Drink and Mountain Dew Game Fuel, but according to GEEIQ, these competitors are starting to gain the upper hand.

TOXIC CULTURE

THESE SEVEN EMPLOYEES All are members of G Fuel’s talent management department, and they serve as liaisons to numerous paid influencers who sign up to promote energy drinks on their streams and social media in exchange for monthly payments or commissions. G Fuel partners, including notable personalities such as Felix “PewDiePie” Kjellberg and Félix “xQc” Lengyel, who created their Its own custom flavors, among other integrations, in exchange for payments that sources told Digiday could run into the tens of thousands of dollars per month. “This is a sizable chunk of my income on YouTube, Twitch and similar platforms,” ​​said content creator Joseph “demonjoe” LaFrance, who terminated his contract with G Fuel after learning of internal changes . “I gave up a considerable amount.” He told Digiday that G Fuel allowed him to terminate his contract without any penalty or protest, although he described the week-long process of calling for the termination of paperwork as “headache.” . The personnel change follows a meeting between G Fuel’s talent department and CEO Morgan . During a regularly scheduled check-in video call during the meeting, Morgan repeatedly blamed G Fuel’s talent managers for the company’s slump in sales and called the previously fired employees “lazy bastards.” According to several former staffers on the call, he continued to call the staff on the phone “late” and forced them to step up, with a half-hearted promise not to Fire anyone to end the call. . After the 5 participants reported the phone calls to HR alone, all were terminated, and two other staff who attended the meeting but did not complain to HR were terminated. “‘Restructuring’ is the word they’re not going to stop using,” said one former employee. The call with Morgan resulted in staff filing an HR complaint, but former staff told Digiday that it was normal for Morgan to use questionable language and that he used derogatory language in other conversations. When asked for comment, Botnick acknowledged that Morgan used colourful language when speaking to subordinates, but said comments such as the aforementioned “lazy bastard” outburst were intended to describe employees’ jobs more broadly, rather than an insult aimed at a specific employee. While the public has been aware of Morgan’s questionable behavior since at least 2019, these revelations appear to be a slap in the face of G Fuel’s claims when he wrote the controversial tweet above, according to the company’s self-reported data. There was little damage to revenue or brand partnerships. Morgan isn’t the only G Fuel executive engaged in questionable behavior. Several former G Fuel employees point to Rob Kligman, VP of Marketing Operations and Talent Management at G Fuel, who say sexual harassment has been reported to top management after inappropriate comments about female influencer bodies Exterior. According to Botnick, G Fuel hired third-party legal counsel Westerman Ball Ederer Miller Zucker & Sharfstein, LLP to investigate the matter and found the sexual harassment allegations baseless. “Rob Kligman vehemently denies ever using the term described,” he said. Digiday made multiple attempts to contact Kligman for comment, but received no direct response. Former employees also say nepotism fuels the company’s toxic workplace, making it harder for rank-and-file employees to come to management with grievances: Morgan’s wife and daughter hold customer service positions at G Fuel, company’s legal counsel Is married to its HR director. “Many companies have relatives who work with the organization, and like any other company, we have taken steps to avoid any potential conflict, and no family member has a reporting relationship,” Botnick said. Possibly the most disturbing circumstance for a former G Fuel employee was an incident on July 26, 2021, involving an executive at the company who was using his mobile phone to participate in a weekly 40 people accidentally exposed their backs to colleagues while taking a shower during a marketing call, according to a video recording of the call watched by Digiday. “We had this call for about 10 minutes, [the supervisor] put his phone on the floor of the shower, took the call, and his camera turned on. I don’t know what happened, I also Don’t know why – but someone yelled at him on the phone to turn off the camera…he was soaking wet, but you definitely saw the ass,” said one former staff member who spoke on condition of anonymity. Despite recent major controversy over similar events at media outlets such as CNN and The Believer, neither G Fuel nor executives have issued an explanation or apology to employees for the incident. When Digiday reached out to the executive for comment, he forwarded all questions to Raquel Colby, G Fuel’s chief administrative officer and general counsel, who then directed Digiday to contact Botnick, who confirmed the incident but noted that none of the employees made the call to the company. HR formal complaint.

Brand Safe Liquidation

with its questionable partnerships and nasty With a history of execution, G Fuel isn’t necessarily the kind of healthy brand that can attract potential partners in gaming and esports. However, the energy drink company remains one of the most famous and popular names in esports, having recently signed partnerships with high-profile teams like the Sentinels in April 2022. It remains a household name for many streamers and YouTubers, whose ties to the brand are bolstered by now-laid-off talent managers. “Our team somehow protects G Fuel from a lot of nonsense and issues based solely on creators we sign off on,” said a former staffer. Some talent managers make more than $1 million in sales per quarter, former employees said, but they could not provide more specific data on company valuations and partner size. When asked for specific numbers, Botnick declined to discuss G Fuel’s financial situation. Now that G Fuel’s seven talent managers are no longer giving the company a friendlier face, its lurking brand safety issues may become more apparent. For example, G Fuel execs are reluctant to address social justice issues in their positive messages ; sources say social posts supporting feminism or LGBTQ issues are talent managers The result of stress, not higher-level employees. “G Fuel is just afraid to take any political stance, any polarizing stance that could divide the community,” said another former employee, who spoke on the condition of anonymity. “That’s why it comes down to it.” G Fuel is far from the only endemic gaming and esports company with a threatening brand skeleton in its closet. Even the popular esports group FaZe Clan, which went public last month, continues to struggle with issues of homophobia and misogyny among its members. For a real reckoning to happen, it seems that the culture of the entire industry needs to change — not just one energy rink maker. Unpopular brands show no signs of slowing down with gaming and eSports companies despite the sluggish economy. But the revelations about G Fuel’s toxic work culture are just the latest in a testament to the problems lurking beneath the industry’s surface. In 2021, when news of Activision Blizzard’s sexist company culture became public, the company’s brand partners responded by pulling out; these days, the Overwatch League has no major sponsor. As brands step up their scrutiny of potential gaming partners and become more discerning when it comes to marketing dollars, companies like G Fuel could find themselves in trouble. “I think a brand has to make sure it’s happy to have a relationship, it’s done its due diligence, it knows who to work with, it knows the potential risk profile and the size of the reward,” Baggs said. “You can’t just go after people, ‘They have a huge audience; this is the right way.'” It’s been more than two months since G Fuel was terminated, but sources say they don’t Forget how things are going. Talent managers will continue to work in the industry—many have already secured new jobs at other local companies—and the talent they work with will continue to build their communities and fans. Their continued presence means the industry won’t soon forget what happened. “I know some people, myself included, are very upset that they still haven’t talked about it; there’s never been any statement, there’s never been such a thing,” said Stallion, another G Fuel partner, He terminated his agreement with the company after learning of the personnel change. “I find it very disturbing and very reflective of the company’s values.”

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