RISE AND FALL OF INNOVATION LABS 2021 - THE DRUM

“Startup incubators were supposed to be the future of retail – so what went wrong?
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— THE DRUM

Storied ad agency Ogilvy & Mather (as it was then known) was also in on the act, launching its own incubator scheme, Ogilvy Labs, in 2008.

Rise and fall

Nicole Yershon, now the founder of NY Collective, set up and led Ogilvy Labs between 2008 and 2016. The unit, she tells The Drum, was formed – following a years-long modernization push within its production faculty – with the aim of positioning the agency at the center of the tech industry, partnering with relevant startups and, ideally, hooking them up with Ogilvy’s clients.

“Nobody really knew the huge scope of digital, no one knew about social media or gaming or mobile or VR, AI, all of these things. So we needed somewhere to have that understanding and then build those partnerships with the people starting up in those spaces.“

The program operated six-month semesters connecting agency staff with external partners and clients, themed around topics, big data or 3D printing. “In the early days, it massively worked,“ she recalls.

Its projects, launched during the formation of the social internet as we know it, saw the agency stage climate-change stunts on Second Life – anticipating the later vogues for corporate environmentalism and the so-called metaverse – and livestream content for carmaker Ford across 19 countries.

Ogilvy Labs enjoyed backing from agency leadership and justified its investment with a number of criteria. “I had a six measures of success: revenue, reputation, retention of existing staff, recruitment of new diverse talent, relationships and responsibility.“

But when Annette King (now chief executive officer of Publicis Groupe) took over as chief executive, the Labs was shut down. Yershon and her four staff were all made redundant. At the time, King told The Drum: “Ogilvy Labs’s job is now done as a separate entity, as each agency continues to innovate within their own specialist area and collaboratively across the Ogilvy Group.“

Looking back, Yershon’s assessment is a little blunter. “She canned it because it wasn’t bringing in revenue.“ With the agency then struggling against Brexit headwinds, cost-cutting arguments won over long-term business cases. “When things get tough, the first things you start off with are the things that can’t pay for themselves.“