California Apparel News

Blue Cult’s streamlining efforts lead to 200 different looks

There is only so much one can do with a five-pocket jean. So Blue Pen Inc., the Vernon, Calif.–based company that is best known for its Blue Cult premium denim label, is streamlining its flagship and focusing its attention on the back pocket.

After introducing four new lines in 13 months, Blue Pen eliminated the skirts and cropped pants from Blue Cult’s collection for Fall 2005. Blue Cult limited the total number of styles to six for women and four for men and offered 20 washes for women and 13 washes for men.

To avoid having the jeans appear too plain, Blue Cult decorated the signature double loops on the back pocket with cream paint, rainbow combinations, pure white stitching and such for a total of 10 variations for women and four for men. And, in a gesture toward its retailers, it is allowing stores to customize orders by choosing their own pocket design with a wash so that they essentially can carry a blue jean that is different from what other Blue Cult retailers stock. With 20 washes and 10 pocket designs for women, that is a selection of 200 looks. “It’s going back to basics for us,” said Caroline Athias, who with her husband, David Mechaly, launched Blue Cult in 1999.

Considering how aggressive and crowded the premium denim market has become, it is vital for Blue Cult to hunker down, focus on the basics and offer something special for retailers. With the advent of so many buzz-worthy labels, older lines can be overlooked by retailers and surpassed in design and innovation.

The last order Local Joe in Bend, Ore., placed for Blue Cult was for Spring 2004. “It was a very good line for us, and then they got too uninteresting,” owner AJ Cohen said recently. After reviewing the Fall 2005 line at MAGIC International in February, he said: “It looks great again. We’re buying again.”

Scott Drake, who was promoted to president of Blue Pen in January after spearheading the launch of the lower-priced Blue 2 group, conceded that Blue Cult previously had a lot of SKUs and was much more interested in fashion.

“It was retailing well, but it was hard to control from a production point of view,” he said. “We lost a little bit of that focus on the basic jean. At the end of the day, that was what was selling and reordering.”

Blue Pen has five brands:

bull; Blue Cult, launched in July 1999; “a chick brand” that was catapulted into the public eye after Gwyneth Paltrow was photographed in a pair ($62 to $75 wholesale).

bull; Sacred Blue, launched in January 2004; rock ’n’ roll–style jeans geared mainly toward men ($72 to $92 wholesale).

bull; Blue 2, launched in April 2004; moderate-priced jeans made of American denim ($40 to $45 wholesale).

bull; RU Blue, launched in February 2005; hip ranchwear for denim enthusiasts ($85 to $205 wholesale).

bull; Sable Blanc, launched in February 2005; tops to complement the jeans ($22 to $68 wholesale).

Nicolas Peyrache designs Blue Cult, Sacred Blue and Blue 2, while Olivier Grasset, who lives in Avignon, France, works on RU Blue. Anna Kovandjiska designs Sable Blanc.

Drake declined to provide financial data for privately held Blue Pen. He said Blue Cult forms the majority of the company’s revenues. He added that Blue 2 generated more than $10 million in sales in its first full year and that Sacred Blue is doing as well as Blue 2. After beginning exporting three years ago, Blue Pen will increase its business in Japan and Europe to take advantage of the weak dollar, Drake said.

Blue Pen does not have a traditional advertising budget, relying instead on viral marketing and celebrity clientele to get the word—and pictures—out. It has about 250 employees and handles its own embroidery and dry-process treatments such as whiskers. It uses laundries that are located within five miles of its warehouses, which also double as corporate headquarters. All products are made in the United States. Drake said the company flirted with the idea of operating its own laundry and that it may still do so at some point.

Blue Pen is also discussing licensing opportunities, he said. Other companies have approached it to license sportswear, which Drake said he could foresee happening in 2006 or 2007. But he said he does not expect to go into leather clothing. “We’d really want to spend our money and our effort on what we know.”

Denim in the genes

What Blue Pen knows is denim. David Mechaly’s grandfather had imported Levi’s from the United States to Morocco. Growing up, Mechaly wore Levi’s 501 jeans, Lacoste shirts and Converse sneakers. He entered the denim business by starting MacKeen in France in 1970. Since then, he has swapped the casual uniform of jeans and polo shirts for baby-blue button-downs, navy slacks and chocolate brown suede shoes to wear in Blue Pen’s office. He is chief executive officer for the entire company.

Drake worked at Hillbilly Jeans in the 1980s, when a five-pocket jean with no wash wholesaled for about $2.88. Other denim lines he started included Hudson Jeans and New York Jean Co.

Athias, a petite French brunette who holds a master’s degree in business administration from Pepperdine University and previously worked in real estate, admitted that she knows nothing about denim. “I am a woman. I want to look a certain way. I want [the jean] to fit a certain way.”

Something for everyone

Retailers are responding to the different lines, which are sold in more than 1,000 accounts in the United States. Athias said Barneys Japan has already picked up RU Blue. Rampage carries Blue 2 in approximately half of its 67 stores. “If you’ve got a great fit with an elevated jean like a Stitch’s or like a Yanuk or like a Blue Cult, and you take that down and do an opening price point, it’s wonderful,” said Brad Cunningham, senior vice president and general merchandise manager for Rampage stores, which is part of San Diego–based Charlotte Russe Holding Inc.

“We’re going through a very interesting growth spurt now,” Drake said. The growth and cachet of the Blue Cult label would seem to make the company an appealing candidate for a public stock offering or acquisition. “If I have a great offer, why not?” Athias said, declining to comment on whether the company had received bids in the past.

In the end, Athias said the jeans business comes down to one basic point: “How do we make it look good to fit everyone?”