• by Michael Shields , July 30, 2004

Knight Kiplinger wants to root out what he considers lousy circulation.

The editor in chief of Kiplinger's Personal Finance believes that the magazine industry is going through a long overdue shakeout as circulation quality becomes more of a focus rather than pure numbers.

"There has been a real focus on connected readers who have asked for the magazine," he said.

Rather than acquiring readers through agents or sweepstakes to keep building up such numbers, Kiplinger's Personal Finance actually dropped its rate base to 800,000 from one million as of last year. The personal finance bible is now smaller than both Fortune and Forbes, and nowhere near the neighborhood of Money's 1.9 million.

While Kiplinger's argument for strategic reduction in size could be taken as spin by a publisher who is losing it, the magazine's ABC statement appears to back him up. For the last five years, Kiplinger's rate base was at 1 million, and the magazine generally exceeded it.

And the title, which doles out investment advice for home buyers, retirement planners, and the like, with tons of detailed tables and graphs, has also been embraced by advertisers. Ad pages are up 13 percent through the first half of this year.

Yet in many ways the magazine is lucky to be around in a category that is barely a category anymore. While the dot-com books' crash and burn has been well chronicled, by Kiplinger's count, seven personal finance titles have disappeared over the last several years, including Individual Investor, Family Money, Bloomberg Personal Finance, and Worth (which has since been re-launched).

Kiplinger is frank about how tough things had gotten in the category, something his competitors didn't always like hearing. "We were not profitable at the time," he said, talking about the massive decline in ad pages starting around 2000. "I couldn't understand when other titles said they were."

Unlike many books talking investments in the late 1990's, Kiplinger's did not have to issue a mea culpa when the market went South, something Kiplinger believes helped protect reader trust. "We never had had to refocus," he said. "We always take the long view. We were talking about coming back to stocks in 2003 before everybody else. We were never overly exuberant about the dot-com market."

The loyalty and trust that readers have shown is something that Kiplinger believes he can sell to advertisers, which is why he is also an outspoken proponent of the Magazine Involvement Alliance, and the group's Involvement Index, a standard available to all subscribers of MRI which is designed to gauge reader's connected to magazines.

"Committed readers are so much more important," he said. As evidence of that commitment, Kiplinger's circulation is roughly 97 percent subscription with a high renewal rate.

Besides involvement, the magazine can sell the very healthy net worth of its readers; it's median household income of $87,046 ranks sixth among all titles, according to Mediamark Research.

When courting advertisers however, Kiplinger, whose grandfather started The Kiplinger Letter in 1923 and thus has a journalist's DNA, is very clear on where he draws the line. "If there is a conflict between the editorial side of the business and the publishing side, it's very simple," he said. "Editorial wins."