DraftFCB has confirmed to Marketing that it will shut down its Hong Kong business, amid what it called "escalating challenges".
Jonathan Allard, regional chief operating officer at DraftFCB Singapore, said the decision was difficult, but had to be made as the agency shifted its focus to Shanghai, Jakarta and Taiwan.
“Hong Kong is becoming an increasingly challenging market, made apparent by some agency closures here recently,” Allard said.
Those closures include M&C Saatchi, which shut its Hong Kong office in May.
“This was a difficult decision but we decided that closing the operation and consolidating creative work into Shanghai (Beiersdorf) and Jakarta and Taiwan (Mondelez) would work to better serve our long-term client opportunities,” Allard said.
Around 26 staff are working for the agency.
The Hong Kong office is the only closure in the Asia Pacific this year and it will not have any influence on Draftfcb’s recent restructure, Allard added.
Allard said local clients were mostly based on project work and discussions are continuing with other clients.
One local client described the news as “surprising”, adding they were in the middle of negotiations about 2014 campaigns.
From 1 January 2014, work on the globally aligned Beiersdorf account that would have been carried out in Hong Kong will be transferred to Draftfcb’s Shanghai operations.
Work for global client Mondelez will be created by its regional hub in Jakarta and adapted for Hong Kong by the Taiwan operation.
As recently as two weeks ago Draftfcb grabbed one Gold and three Bronze awards at the annual Kam Fan Awards.