Kids Rule at Ruum
Ezra Dabah is no stranger to children’s wear. As the former chairman and CEO of The Children’s Place, he helped create a billion-dollar retail powerhouse. Dabah left the company in 2007, but he returned to the kids fashion business with Ruum American Kid’s Wear, a fashion-forward upmarket concept that bowed in 2012 and operates 24 stores, primarily in malls.
In the fall, Ruum opened two freestanding digital-savvy boutique “ShowRuum” locations in Manhattan and one on Newbury Street in Boston. Based on their success, the company has shifted gears to a boutique strategy. It plans to open 25 locations on Main Streets across America over the next 12 months, and is in the process of shuttering its mall stores.
Ruum’s boutique format is not your typical retail store. It’s a high-service showroom format, with only one of each item displayed on the sales floor, so the clothing “has room to breathe,” according to Dabah. Sales associates bring shoppers the requested clothing, accessories and footwear they have selected (in Ruum lingo, it’s called personalized Ruum service). The individual orders are placed on the in-store iPads. Consumers can have packages delivered in as little as two hours, by UPS in two days or leave with the merchandise in tow.
The stores (and merchandise mixes) are designed to mesh with the vibe of the neighborhood, and include such amenities as toys, lounge areas for parents and local events, from a children’s books and crafts event to a red-carpet fashion show.
The retailer now has set its sites on operating 250 Ruum boutiques in the United States (it is closing its mall locations as part of the shift to a boutique strategy). It is also nurturing a wholesale business in other domestic and international department stores.
Dabah spoke with contributing editor Barbara Thau about Ruum’s new ShowRuum strategy and how he believes it’s poised to fill a void in the children’s clothing market.
How does your past experience shape Ruum?
My family started the Gitano Jeanswear business and developed it into a thriving fashion brand. Gitano led me to open EJ Gitano, the children’s wear brand. Eventually, we acquired The Children’s Place, which I led as chairman and CEO.
Starting with EJ Gitano in 1984 and The Children’s Place beginning in 1990, we have decades of experience in children’s fashion. We endeavor to make kids look good and feel good, so they can make their world a better place.
What void does Ruum serve in the marketplace?
I think what’s missing [in the market] is fashionable, well-made clothing at a parent-friendly price point. Our unique details and styling are kid appropriate, and at the same time, are fashion ‘look makers.’ Ruum American Kid’s Wear stores are unique in their-kid-friendly environments, with their interactive kiosks, photo booths and other details. It is important for us to support the neighborhoods we are in, so there are several programs in place to support the local area.
Who is your target audience?
We appeal to parents by delivering luxury fashion at great value. Ruum is also about empowering kids to feel great about themselves, and part of that is allowing them to make decisions on what they want to wear and to be able to express themselves through their clothing. Our items are related separates so anything can be dressed up or dressed down for multiple uses.
Why did Ruum shift from a mall-based store strategy to a boutique one?
We think boutique locations at the street level allow for a higher level of service, selection and convenience. The boutique concept allows us to offer a great selection of kids’ fashion in the city and surrounding neighborhoods.
What’s the expansion strategy?
We believe we can have as many as 250 boutiques in the United States. We also have a wholesale strategy. Ruum is a top-selling children’s wear brand at Lord & Taylor, where it is featured in 47 stores in the United States and in 100 Hudson’s Bay stores in Canada.
What’s the strategic thinking behind Ruum’s personal service and showroom merchandising approach?
All boutique stores are designed to reflect their neighborhood and are focused on the highest level of Ruum service with curated designs in a streamlined shopping environment. The boutiques are created for style-minded kids who know not only about the latest fashions, but want to express themselves via their fashion choices. This new concept allows us to provide boutique-style clothing in a boutique environment, without the boutique prices.
What are your biggest growth opportunities?
There are a number of brands in the ‘moderate fashion for less’ [business] and quite a few smaller players on the upper end of the spectrum. Ruum has found that there’s almost no one doing luxury kids’ clothes at prices that parents consider a good value.
As a veteran of the children’s business, what are the seminal ways the market has changed for children’s clothing?
The industry has certainly become more competitive and is becoming more trend-driven every year.
What do you see as the most important changes redefining the retail landscape?
Online shopping is playing a greater role each season, so we are constantly improving our site and making it easier and more fun to shop. We also know that customers expect a certain level of convenience and service. Our boutique strategy is to provide a unique and meaningful customer experience, while supporting local neighborhoods. For example, the Ruum Give Back program gives 20% off to shoppers and an additional 20% goes back to the school or organization.
What are the key differences in children today that must be reflected in how you conduct business?
When shopping for our kids, we are shopping out of need as they grow out of clothing so quickly. We are considering their lifestyle needs — for school, occasions, holidays and vacations. Also, today, children are exposed to so much imagery and information at an early age that they develop opinions very early on. Ruum’s designs look to satisfy both the kid and the parent. Our stores are filled with great choices, and the new Ruum boutiques offer a level of service so that every kid, from the rocker-to-be to the classic cool kid, can find looks they love.
What are the big challenges?
The big challenges are distinguishing the brand in the marketplace. At our boutiques, things work a little differently. We are the first retailer in New York City with a personal-service model in the kid’s market. Ruum is also expanding to department stores, and the brand has been extremely well received.
How big do you envision the wholesale business to be?
We have had several very positive preliminary meetings with upper-e