Time Inc. (NYSE: TIME) is the latest publisher to add paid membership programs to its offerings in the hopes of generating additional revenue. On September 27, the company announced the launch of People Perks, a membership program for People magazine readers, for $60 a year or $5.99 a month after a 30-day free trial. Members who pay annually also receive a free welcome kit, and all members receive exclusive discounts on entertainment, style, food, beauty, pets, home and shopping products and access to unique celebrity and red carpet experiences.
The deals include offerings from more than 400,000 national retailers and local, independent merchants including Macy's, Bath & Body Works, Staples, Olive Garden, Barnes & Noble and Best Buy. People Perks members can also earn cash back when shopping online and can enter contests to get VIP access to events like Tony Award rehearsals, the Oscar Fan Experience and the Entertainment Weekly/People Upfront Party. According to People, members can save more than $1,200 a year on dining, travel and entertainment with the Perks program.
‘PEOPLE Perks, like PetHero, a new paid membership program designed for the millions of pet owners nationwide, reinforces Time Inc.'s commitment to creating new, relevant and provocative product offerings for our large direct customer base that includes 30 million subscribers and a digital footprint of more than 127 million uniques every month,' said Leslie Dukker Doty, executive vice president of consumer marketing and revenue in a press release.
‘The People Perks membership program provides access to a very wide variety of savings. It also enables our retail partners an opportunity to connect and engage with the People audience in new says,' said Jess Cagle, editor-in-chief for People magazine.
In July, Time Inc. launched PetHero, a discount membership program for dog and cat owners that offers 25 percent off participating veterinarian services (e.g., office exams, vaccinations, spaying and neutering, dental x-rays, etc.), 15 percent discounts on orders and prescriptions from PetCareRx.com, 24/7 access to the Lost Pet Concierge service, quarterly toy and treat boxes, expert pet advice and more. Membership fees are based on the number of pets a member owns:
- Single cat: $20 a month
- Single Dog: $20 a month
- Two or more pets: starts at $25 a month, additional pets for $5 more per month
The launch of People Perks came just two days after Time Inc.'s 8-K filing with the Securities and Exchange Commission which outlined cost cutting and new revenue opportunities, including the possible divesture of some of its assets – Time Inc. UK, Time Customer Service, Essence, Sunset, Coast Living and Golf. The sale of all of these assets could yield as much as $488 million in revenue.
The addition of membership programs is a good move for Time Inc., particularly for popular brands like People with a loyal following. Except for marketing, promotion and customer service, the overhead for such a program seems minimal, creating a nice revenue source for Time Inc. without a lot of effort. Time Inc. needs to find more of these opportunities, and to get moving on its divestures, to make up for lost revenue. In the second quarter, for example, Time Inc. revenue dropped by $75 million, or 10 percent, year-over-year. The company cannot continue such losses indefinitely.