NEW YORK — Last summer, a few months after joining Caché Inc. as chairman and chief executive officer, Jay Margolis met with Marilyn Rubinson, former owner of Caché, for dinner at Cipriani in Miami, to better understand the retail chain and its roots.
This story first appeared in the January 24, 2014 issue of WWD. Subscribe Today.
“Here’s this 88-year-old woman, in a chic linen suit, and she’s driving a Mercedes — no driver, she’s driving it,” Margolis said, recalling the encounter.
She showed Margolis a decades-old photo of herself in a bathing suit by the cabanas at the Fontainebleau, and recollected how Caché once sold such designer labels as Genny, Thierry Mugler and Claude Montana, and stressed service and outfitting. Margolis was impressed. This lady, he thought, still embodied the spirit of Caché, what it once represented — a high-end, highly curated specialty store.
“She was so striking — so elegant, so put together,” said Arnold Cohen, Caché’s chief marketing officer, who accompanied Margolis on the Miami trip. “She gave us the inspiration.”
In an interview at Caché’s offices on West 38th Street here, Margolis and Cohen described their “360-degree effort to reposition Caché in a new, modern way.” They cited the completely recast top management; the revamped, focused collection; a prototype store that opened in the fall setting the bar for renovations and future openings; the current “Belle of the Ball” campaign depicting smiling models checking each other out as they enter a black-tie event, and remaking the Web site.
The company was founded by the Rubinsons in 1976 and is publicly owned and losing money. But Caché has been hanging on with 243 units, averaging 1,900 square feet each, and annual volume at about $230 million, making it small enough for managers to readily wrap their arms around and reengineer.
Margolis, an industry veteran who held top jobs at Limited Brands, Reebok, Tommy Hilfiger, Esprit and Liz Claiborne, joined the company in February and purchased $1 million worth of Caché shares. He’s brought in Daphne Pappas, chief merchandising officer and former Saks Fifth Avenue merchant; Tony DiPippa, chief financial officer; Jennifer Ehrenfeld, senior vice president of design, and Cohen. Other merchants with upscale experience are on board, including senior merchandising directors Elizabeth Talkin, for dresses, formerly with Burberry and Bergdorf Goodman; Lydia Marcus, sportswear, who worked at Dolce & Gabbana; Penelope Nam-Stephen, accessories, who worked at Burberry and Versace, as well as Sal Lenzo, vice president of visual merchandising, who held similar posts at Saks and Burberry. The team has built up day-into-evening dresses to represent 35 percent of the assortment (in dollars) and special-occasion dressing, including gowns and prom, to 15 percent of the assortment. Prices are up 10 to 20 percent and range from $200 to $1,000, reflecting higher-quality fabrics and more sophisticated looks. Dresses with cutouts, without being too revealing, and gowns with sequins are among the bestsellers. “Being the best in category is very important for us,” Margolis said.
“Whether it’s day-to-date, special-occasion or gowns, there’s no boutique authority in the mall other than us,” Cohen added. The better dress business is “the white space we fill because there is no specialist in this. Malls have plenty of sportswear, jeans, kids and electronics retailers. We are unique.”
Floor sets are changed twice a month, instead of once a month previously, to generate higher traffic and merchandise turnover. With each set, about 30 percent of the selling floor gets transformed. “How we flow in the goods creates excitement and gets consumers in the stores,” Margolis said. Though jeans, leggings and “date” tops remain important to the business, the sportswear content overall has been reduced. “We are out of the relaxed sportswear business,” Cohen said. However, “If it’s cold in New York City, we have a trouser and jacket and top she would want to wear. We have sportswear, but it has a dressier, updated approach that’s more fashion-oriented. We’re not a commodity business. The sportswear now works with dresses. In other words, there’s alignment. Before, this was a very disjointed, very disconnected company. There was nothing harmonious about it.”
It had become too dependent on sportswear, junior looks and perpetually putting merchandise on sale, Cohen said. “We’re not playing in the promotional space anymore,” he added.
As part of the alignment, the executives cited stronger efforts to coordinate accessories with the apparel and last year’s addition of jewelry designed by R.J. Graziano. All of Caché’s merchandise is private label with the exception of the co-branded R.J. Graziano for Caché jewelry. Caché is open to co-branding with other designers.
A store prototype in Las Vegas opened in September. Designed by Robin Kramer, it features a circular gilded birdcage to hang dresses, as well as chandeliers and spacious, silk-lined dressing rooms. Elements of the format are being rolled into certain other locations, like the Houston Galleria and Pentagon City, Va., stores, including the same shimmering gold fixturing, which is offset by dark wood floors and the large open-sell jewelry tables.
Margolis wouldn’t comment on Caché’s performance last year overall, other than saying the company had a good holiday run. It lost money in the first three quarters of 2013 and in 2012. But the new team’s impact on the merchandise didn’t start becoming evident until October as the company worked fast to get rid of merchandise under the previous regime and bring in fresh styles. The spring collection is filled with head-to-toe bright whites, cutout details, “midnight blossom” prints and jumpsuits, either sleek and simple or embellished.
Looking ahead, Margolis said store renovations will continue; handbags and jewelry need to be built up, to 12 to 15 percent of the assortment from the current 7 percent, and the Web site is a work in progress. It’s steadily being overhauled to be in sync with the stores on pricing and presentation, for more of an omnichannel approach. The relaunch of cache.com, which generates about 10 percent of total revenues, is scheduled for the end of May.
“It’s been like a reinvention of that little specialty store,” Margolis said, the one that Marilyn Rubinson and her family once owned.