The Kliger Conundrum

Folio: The Magazine for Magazine Management, August, 2001 by Joe Hagan

HACHETTE FILIPACCHI CEO JACK KLIGER HAS STOOD CURIOUSLY STILL WHILE HIS COMPETITORS WHEEL AND DEAL ALL AROUND HIM. WHY? THE ANSWER LIES WITH A SURPRISINGLY VITRIOLIC STRUGGLE FOR CONTROL OF HIS FRENCH PARENT COMPANY.

Like a true salesman, Jack Kliger welcomes his guests with a cigar. A Cuban, no less.

"I didn't smuggle these," deadpans the CEO of Hachette Filipacchi Magazines.

Here in the 45th-floor office of this silver-haired CEO, it's easy to be lulled by the bonhomie, the stunning view of Manhattan's West Side, and the swirling cigar smoke. Listening to Kliger chat freely about his love of fine wine, his daughter's upcoming departure for college, and his possible return to Manhattan from suburban Westchester, it becomes clear how the former publisher at Conde Nast Publications has been turning easy-going charm into ad dollars for years.

That convivial atmosphere has defined Kliger's first two years as CEO of the French-owned Hachette. But it has also come to symbolize a company that is seemingly adrift. While Kliger has garnered the bulk of his press attention for shutting down magazines--Mirabella, Audio and, most famously, George--his competitors have been wheeling and dealing, jockeying for position in an era of frenzied consolidation. Last year, for example, Time Inc. paid $475 million for Times Mirror Magazines, a group of publications that would have fit in perfectly with Hachette's own mix of men's enthusiast titles like Boating and Flying, and would have suited Kliger's vision of spinning off multimedia products from niche titles. Advance Publishing spent nearly $400 million for The New York Times's Golf Digest group of properties. And Gruner+Jahr USA Publications, after years of do-nothing management, hired a new CEO, Daniel Brewster, and shelled Out nearly $600 million to buy Fast Company and Inc., while turning McCall's into a st ar vehicle for Rosie O'Donnell.

And, as Kliger spends a Monday in late June talking to a reporter about his maddeningly amorphous plans, executives at Primedia are putting the finishing touches on a $515 million offer to buy Emap USA. Instead of consolidating control of one of its most important categories--automotive, where it owns Car and Driver and Road & Track--Hachette, strangely, did not even bid for the publisher of Motor Trend, Hot Rod and other enthusiast titles. The addition of Teen could also have provided a nice circulation jump-start to Hachette's soon-to-bow Elle Girl--Kliger's sole launch, and one headed to a crowded market showing signs of saturation. (See sidebar, page 26.)

"Does it worry me as much as any competitive situation, more than before?" Kliger asks rhetorically about the Emap sale, with a not entirely convincing nonchalance. "We'll have to wait and see. I'll be interested to see what kind of synergies they can create."

By now, this "wait and see" attitude is a familiar one at Hachette. But Kliger's group-hug, consensus-seeking management style is not the main reason for the company's stasis; much of the blame must go to Hachette's tangled web of baffling corporate affiliations, which has hamstrung Kliger, thwarting his plans for a multimedia expansion driven by the magazine brands.

As is the fashion nowadays, blame the parents--in this case Paris-based Lagardere Group SCA, an unwieldy mix of defense, automobile and media properties including Paris Match. Hachette's parent company may be sitting on oodles of cash, but it isn't inclined to spend very much on magazines in the United States. This ambivalence stems directly from a power struggle playing out between the two men to whom Kliger reports: Gerald de Roquemaurel, the courtly, conservative CEO of the international magazine group, Hachette Filipacchi Medias; and Arnaud Lagardere, chief executive of the media wing of Lagardere, booster of all things interactive, and company heir apparent.

The two men hardly talk to each other. The result in the U.S. is something akin to paralysis and the breeding of a crop of fascinating conspiracy theories involving a return of former CEO, David Pecker. "There is a level of frustration at the company that I've never seen before, and I feel very sorry for the executives who are there," says a media executive who has worked closely with the U.S. division. "They have great properties and Jack knows what to do with them. But he's not able to."

No more guillotines

Landing the CEO spot at Hachette certainly seemed like a good gig two years ago. To Kilger--after 19 years in the Newhouse empire, during which time he made Glamour the most profitable publication at Conde Nast before moving into the executive suite and then to the numberthree position at Parade--a top job was certainly appealing. It gave him a chance to escape working for larger-than-life personalities like Conde Nast CEO Steve Florio, and to leave behind a corporate ambiance not exactly conducive to camaraderie.

Kliger has indeed made Hachette a more enjoyable place to work than it was under his predecessor, David Pecker. With Clintonesque aplomb, he strolls the halls of the company, hanging out, shooting the breeze, listening to new ideas. When Brandon Holley, editor in chief of Elle Girl, approached him recently seeking permission and cash for commissioning songwriter Michelle Lewis to write a theme song for the new magazine, Kliger promptly agreed, much to her glee. She calls him the "Dad of the company."