The Four Questions: Knight Kiplinger, Editor-in-Chief of The Kiplinger Letter, Kiplinger’s Personal Finance, and Kiplinger.com
W.M. Kiplinger created the Kiplinger organization in 1920 and published the first successful financial newsletter in the nation, The Kiplinger Letter, in 1923. To this day, it remains the longest continually published newsletter in the U.S.
Although Knight Kiplinger shares the name of his empire—The Kiplinger Letter, Kiplinger’s Personal Finance magazine, and Kiplinger.com—he didn’t start there. Instead, he worked as a Washington correspondent and newspaper editor for 13 years before joining the company in 1983.
He created Washington Editors, Inc., which publishes the Kiplinger titles. In 2002, the company won the Business Ethics Award in the small-business category awarded by the Society of Financial Service Professionals. And, in 2007, Washington Editors, Inc. was recognized by Ethisphere magazine as one of the “world’s most ethical companies.”
With publications currently pushing editorial boundaries to increase advertising dollars, Kiplinger is a good person to ask about the new model for success.
Q. What makes the newsletter model work? How has it survived this long?
A. Subscribers pay 100% of the costs of publishing newsletters because there is no advertising support. The newsletter model requires high editorial quality, which results in high renewal rates.
After decades of under-pricing their magazines to subscribers (due to an over-reliance on ad revenues), many magazine publishers are now studying the newsletter model because of declining ad pages. I foresee a new era in which magazines will charge their loyal subscribers much more and accept the fact that circ levels will gradually drift down to more-appropriate, sustainable levels. Gone will be the revolving door, low-renewing readers who were initially lured in by agent-sold subs at rock-bottom prices. Advertisers will win, too, by getting a more committed audience of magazine readers who are more likely to actually see their ads.
Q. How has the recession shaped your financial coverage? Has it changed your readership?
A. Our editorial mission--in both The Kiplinger Letter and Kiplinger's Personal Finance--is to help people foresee financial changes ahead and adjust their plans accordingly. So our coverage is even more compelling today, and it hasn't required any major changes--although we now do write about more distress-related topics (preventing foreclosure, rebalancing portfolios, taking advantage of bargain-priced investments, etc.).
The size of our readership seems unaffected by the recession; it's just advertising pages that have dropped, as marketers have trimmed their ad budgets to conserve cash. "Not surprisingly, our subscription sales programs--both for the newsletters and the magazine--are doing very well right now, apparently due to the higher perceived need for the kind of advice we give."
Also, traffic and advertising on our website continue to climb, as more and more Americans look online for sound advice in these troubled times. Though web revenue growth helps offset, it does not totally replace declining magazine ad pages.
Q. What's the best idea you've ever gotten from a subscriber?
A. Our magazine readers often suggest excellent story ideas from their own experiences, and we jump on those. Most of our current May cover story--"Survive This Recession"--is based on queries from readers about their real-life dilemmas, seeking our advice. The woman on the cover, for example, wrote to our "Ask Kim" column (written by our crack personal-finance trouble-shooter, Kim Lankford). After answering her query about plunging home equity, Kim explored whether the woman would agree to be interviewed and photographed for a feature story, which was done by our writer Laura Cohn. We enjoy a very close relationship with our readers, personally answering every query and comment they send us. We think this accounts in part for our high renewal rates.
Q. How has the model for success changed since the company first started?
A. During the Golden Age of Print Publishing--i.e., pre-World Wide Web--magazines became too dependent on ad pages in their revenue mix, and now we're all paying the price. As noted above, our magazine (and I expect others) will be exploring a move back to a heavier reliance on subscription revenue, even as we maintain cordial relations with our loyal advertisers. We'll be seeking an equilibrium level of circulation based on higher prices, even-higher renewal rates, and--most likely--lower total circ. At the same time, we'll continue to derive higher revenue from rising Web traffic, other new media (such as ad-sponsored DVDs), and custom publishing.
In the end, readers will find high-quality editorial content wherever it resides, whether in print or on the web. Purveyors of quality will endure.
--Interview by Dara Pettinelli
