People Magazine to Offer New Subscription Deals

As magazines have scrambled to find new revenue sources, People has stuck with a model that has worked for nearly four decades: high-paying and loyal subscribers, now about 3.5 million, and advertising. Now the magazine is changing its subscription model, adding a tiered plan to what has long been considered the financial backbone of Time Inc.

s magazine empire.On Monday, the magazine is introducing four new subscription packages. It is trying to attract younger, tech-savvy celebrity fans with a $10 annual subscription to its new CelebFood and CelebWatch apps.

Its current fan base, whose members pay about $112 for an annual print subscription, can pay the same amount for either a print or digital subscription or they can upgrade to a $132 package for both. For its most devoted celebrity watchers, People is introducing a $200-a-year package that includes both print and digital subscriptions, access to new online material, a six-month gift subscription for a friend and intermittent gift boxes designed by the editors. The kickoff gift box includes designer note cards inspired by this seasons shirtdresses, an animal-print scarf influenced by the styles worn by Heidi Klum and vinyl nail wraps that give subscribers a glimpse at Rihannas style.

Larry Hackett, Peoples managing editor, said it had to update its approach despite its profitability.We need to find change. We are not immune to what is going on in the magazine industry, Mr.

Hackett said. We are upending our subscription model.While People has suffered declines in newsstand sales, it isnt doing as badly as its rivals.

Data tracked by the Alliance for Audited Media show that Peoples newsstand sales fell 11.8 percent in the first half of 2013 compared with the year before, but its total circulation held steady at 3.5 million.

People still generates the most revenue among the nations top 50 magazines, producing $1.4 billion in annual subscription and advertising revenue in 2012, according to data gathered by John Harrington, a magazine consultant. That is roughly equal to the combined revenue generated by four other Time Inc.

titles, Real Simple, Time, InStyle and Entertainment Weekly.It leads in revenue in every aspect, whether its newsstand subscriptions or advertising, Mr. Harrington said.

It dominates the publishing business.Still, Mr. Hackett said, because Peoples subscription business remained stronger than newsstand sales, it made sense to nurture these more profitable relationships.

You had to look and say, O.K., how are we going to get other revenues?

Mr. Hackett said.In the coming months, more news organizations are expected to follow a similar path.

Based on how Peoples subscription model fares, Real Simple is expected to offer a more varied subscription model soon. The New York Times Company announced in April that it was working on plans to offer more customized subscriptions at lower prices for readers interested exclusively in specific content, like editorials or food coverage. The Times expects to introduce additional products in 2014, according to a spokeswoman, Eileen M.

Murphy.Mr. Hackett acknowledged that by asking readers to pay for new and arguably more expensive products, People had to rethink the kind of content it offered.

Now, Mr. Hackett said, People will act less like a magazine and more like a credit card by offering rewards like gift boxes three times a year tied to the Worlds Most Beautiful issue in the spring and to next years fall fashions. It will also offer subscribers monthly raffles that provide access to events, like standing on the red carpet at the Oscar award ceremony.

But People hasnt strayed too far from its original idea. The magazine hired 20 new employees to expand its online material. During the Web sites debut on Monday, readers will be able to get more details from Peoples latest interview with Alec and Hilaria Baldwin about the birth of their new baby.

The CelebFood app also is kicking off with 200 celebrity recipes, like Blake Livelys chicken and leek pie.The magazines executives hope the new offerings attract readers younger than its current subscribers, who have a median age of 44.6, according to the audience measurement company Gfk MRI.

But the one thing Mr. Hackett said would not change is the magazines writing style or overall approach to news. Mr.

Hackett quoted Richard B. Stolley, Peoples founding managing editor, from his first editors note in 1974 as a reason not to become snide like many celebrity titles.We hope never to be cruel or awe-struck or gushy, Mr.

Stolley wrote.