Ogilvy Labs is to be closed with all staff being made redundant it is understood, including its boss Nicole Yershon.
The team of five, including its director of innovative solutions Yershon who started the division in 2008, are understood to be leaving the business which was closed following a cost cutting drive by the UK network.
Nicole Yershon, the director, innovative solutions at Ogilvy Group UK, broke the news last night in a tweet saying: "It’s with regret that Labs has been shut down".
Its with regret that Labs has been shut down - if u need to speak abt anything non Ogilvy related, please connect via social media channels
— nicoleyershon (@nicoleyershon) August 8, 2016
Annette King chief executive of Ogilvy & Mather Group UK, told The Drum: “Innovation has always been an integral part of the Ogilvy DNA. Ogilvy Labs pioneered the way we approached innovation and over its tenure helped us successfully embed innovative thinking and campaigns into each of our agencies and many of our award winning clients.
"Ogilvy Labs’ job is now done as a separate Ogilvy entity, as each agency continues to innovate within their own specialist area and collaboratively across the Ogilvy Group.”
In April, Ogilvy’s worldwide executive director and EMEA chairman, Paul O’Donnell, warned the agency would reduce its investment in the UK if the country voted to leave Europe, which it subsequently did. Speaking at one of The Drum’s events at Advertising Week, O’Donnell said: “Certainly we would not invest further in our UK business in a non-EU environment. We would have to make investments elsewhere to serve our clients.
“Not one of our clients has increased their budgets this year which is in part due to the uncertainty in markets. But the rest of it is down to huge global uncertainties, number one of which for us is the EU position. Should we vote to leave I see huge decline in our business this year as a shop, and I think we will have seen the high point of the creative services industry in London. From [then on] it will be a slow and maybe more dramatic decline.”
In an internal memo seen by The Drum the agency's UK chief executive Annette King told staff that the agency needs to "be better and faster at making work," following the closure of the self-funded research and development offshoot.