application variable vs data caching?

The cache is good, but it is considered volatile. There is never any
guarantee that the data is there. The item may be removed when it expires or
some condition is met (something you explicitly set), or the runtime may
remove the item when memory gets low. In contrast, the application variables
are there for the duration of the applications life, unless explicitly
removed by you and it provides methods to synchronise access to the
varibales as well.