For consulting clients, PSFK has a method for compiling research to discover a trend, rather than follow what's already been declared one by the mainstream media. The company also uses this method for its topic-based reports for sale to non-clients. For several weeks, PSFK researchers around the world gather hundreds of examples of emerging innovations. Then, the researchers use PSFK's method of pattern recognition to define a trend, which Fawkes explains is validated by tallying the numbers of similar examples the team has catalogued in the private PSFK intranet. The patterns are then supported by insights gained from experts that PSFK taps from its vast network, and their observations -- all primary research -- are quoted in the report. For the"Future of Retail" report, for instance, opinions from Mike Peck, Senior Design Manager, Brand and Packaging for Starbucks (SBUX), and Mike Milley, Manager of Design Research and Strategy for Samsung, backed up trends that PSFK consultants identified, such as "digitally empowered staff" or "store-within-a-store."
And that is PSFK's secret sauce. Rather than an arbiter of good design or effective strategy, it acts as an aggregator and validator, a brain trust as much as a tastemaker. Parsia and Fawkes say that the privately held company has more than doubled the number of corporate consulting clients since 2009, which accounts for the majority of the firm's revenue. About 70% of this comes from consulting. Twenty percent of revenue comes from conferences, which draw hundreds of attendees, and smaller events. The final 10% comes from content sponsorship and advertising.
While custom research is driving revenue today, Weiner says the company hopes that the stream will become more balanced between the three parts of the business. This is likely to take the form of commissioned thought leadership, or articles on specific topics that will be sponsored by a corporation, bundled with related events and a possible custom report. PSFK has been working recently with tech giants Microsoft and Intel on such projects recently.
But the free, daily site PSFK.com is still a draw even for many of the company's consulting clients -- and 1 million site visitors a month. Some contributors and contributing editors have day jobs at influential companies -- from athletic gear maker Adidas to advertising agency Wieden + Kennedy -- who write posts of only a few hundred words spotting products and products that catch their eye personally. Fawkes and others on the full-time payroll also contribute. Recently, these posts have included pithy observations on Disney's (DIS) debut of life-sized augmented reality villains in Times Square, or an overview of clothing made with "intelligent textiles" embedded with sensors, accelerometers and other tools to measure wearers' activity and health.
At Microsoft, the Brand Strategy team and Trends Council, among other employees at the software company, regularly read and discuss what they come across on PSFK's site, says Robin Lanahan, director of Brand Strategy at Microsoft. "Their blog is essential reading for keeping track of what's to come, because they see beneath the culture to the underlying trends that percolate up before they become significant," says Lanahan.
Despite its impressive client list and growing capabilities, it's unlikely that PSFK will threaten the likes of McKinsey, an 85-year-old firm that has some 9,000 consultants worldwide, or McKinsey's peers such as Boston Consulting Group, especially in the arena of management consulting. (Although in terms of building a thought-leadership brand, PSFK could be considered an upstart competitor.) Nor is PSFK even trying to compete with the likes of decades-old innovation and design firms such as IDEO or Smart Design, which in recent years have begun to offer business strategy on emerging technology and cultural trends that affect product design and development.
But these aren't really PSFK's ambitions. The company wants to remain nimble and keep their start-up feel and energy, says Fawkes. That way, the consultancy and its media platform will continue to provide blogger-style curiosity and speed, in terms of research and analysis of off-the-mainstream-radar trends that essentially appeal to the staff's personal, youthful tastes and stylish sensibilities. "We want growth, but I don't know whether we need to be a 50 or 100 person company," Fawkes says. "What we do well is curating inspiring ideas to help companies paint a picture where innovation can happen."
