HONG KONG: Lemon has slashed staff numbers by more than 50 per cent
in an effort to stay afloat amid declining adspend and reduced marketing
budgets. The web design agency has also changed its business model to
offer corporate communications services, including brand consultancy and
traditional marketing.
Neil Runcieman, chief executive officer at Lemon, said the layoffs were
the result of economic conditions. "The situation is that our clients
don't have money to spend. It's not a case of they don't want to, but
business is slow and they have either cut their budgets or just aren't
spending at all.
"I held on as long as I could, but something needed to be done. It soon
became obvious that the situation wouldn't improve and we had to cut
back, which is what a lot of our customers are doing. I don't see a
turnaround in the short term. We still have work in the pipeline and we
will continue with this as normal."
The agency, set up in 1995, was forced to reduce its headcount from
about 54 to 25. Its portfolio of clients included CLP, Hong Kong Jockey
Club, KCRC, Nike Asia-Pacific, Fosters, and dotcoms such as the defunct
AdSociety.
The agency also serves British Airways, which it picked up when it
acquired Mercatela.
"We've been expanding our service offerings over the last six to nine
months. Lemon initially began with web design.
"We have people here with an offline background, including myself, and
that has helped us understand all the various options for our
clients.
Now, we are not going to them and saying we will build a website for
you, but we are giving them what their business really needs. It's a lot
easier to talk to people when you're going in there helping clients
achieve an increase in their state of business and helping them
communicate better with clients."
Runcieman stressed that the agency was not in competition "with the
likes of Ogilvy & Mather and Landor".
