Not that he's feeling any pressure, but Steve Cone may be the one person shareholders are counting on to deliver the revenue synergies that were promised when Keycorp merged with Society Corp. this spring.

Mr. Cone, 44, is the new executive vice president for corporate marketing and strategic planning at Keycorp. He is responsible for making sure the nation's 10thlargest bank wisely spends untold millions of dollars so it can make more from customers ranging from Maine to Alaska.

His answer: targeted marketing. Under Mr. Cone, the Cleveland-based company will spend more on cable television than on network advertising, because cable reaches the demographic groups the bank wants to attract. He also plans heavy spending on telemarketing and direct mail designed to turn the company's customer data into a money-making leads.

"What I want to do is shift from a mass marketing approach to focusing on more specific customer segments," said Mr. Cone, whose credentials include heading consumer bank marketing at Citicorp and several years at American Express Co. "Over time, we can probably double our rate of growth of revenues per customer by improving our crosssell," he said.

His boss, president and chief operating officer Robert Gillespie, said Mr. Cone's efforts are on "the short list of critical success factors for us.

"It sounds so damn simple that we have to be customer-driven, but we are flying in the face of hundreds of years of tradition in banking," Mr. Gillespie said.

To be sure, marketing is increasingly important as banks enter an era of accelerated interstate expansion that will take them well beyond the homogeneous single markets they controlled barely two decades ago. But many observers say that banks are a generation behind other industries and most financial services companies in how they spend their marketing money.

No one is certain how much banks spend on marketing, though experts widely agree that the top 25 alone spend $1 billion, exclusive of credit card marketing.

While some bankers privately disparage the rise of marketing in a business long dominated by loan-making MBAs, they admit it is essential to survival against marketing savvy companies who focus on a narrow line of products.

"There is an understanding among some bankers that they can no longer sit in their skyscraper offices and wait for the business to come to them," said Sandra J. Flannigan, banking analyst at Merrill Lynch & Co. "More banks are realizing there can be advantages to selectively stepping up their campaigns."

Increasingly, banks are splitting their money between namebrand advertising and productspecific promotions. At First Interstate Bancorp, a new oneyear campaign was just rolled out to promote products ranging from home improvement loans to checking accounts, building an image of the bank as a cradle-tograve financial services company.

It's a hybrid of the old style of marketing and the new," said Dennis Shirley, senior vice president and head of marketing for the Los Angeles-based bank, which operates in 13 western states. "Historically, banks have been very institutional. We're trying to be more retail in the way we approach our marketing."

Mr. Shirley believes the campaign is on target, but admits that similar ideas are used by other major banks. At the same time First Interstate was rolling out its new effort, Norwest Corp. was doing the same.

Though the message was the same, the Minneapolis-based superregional took its own approach, in a series of ads launched last month.

Norwest's "To the Nth Degree" campaign features comedian Bob Newhart adapting his signature one-sided telephone conversation routine to discuss products in the bank and its nonbank subsidiaries.

"This has to do with opportunities across business units," said Cynthia Gray, who oversees marketing at Norwest. "We are trying to stress that we are a full-service company." Still, most bank marketing executives give the industry low marks for originality.

Larry Bayliss, senior vice president for advertising and public relations at St. Louis-based Boatmen's Baneshares, recalls judging a bank ad contest and suffering through a monotonous repetition of the same dull theme. "It was the bank is a bank is a bank ad," he said. "A few banks were able to cut through the clutter, but not many."

One campaign that rivals say has been successful is for Columbus, Ohio-based Banc One Corp. Craig Kelly, senior vice president and head of marketing, credits his autonomy and the bank's commitment to focusing on simple principles.

"When it comes to ad spending, bankers are usually shortterm thinkers. God love [chairman] John McCoy, but he doesn't second-guess me;' he said. "To be effective, you can't say it all, which is a mistake most banks make. We must practice the art of ruthless exclusion."

At Keycorp, that means the evening news is out and more targeted cable is in. With 14 states in its market and another half-dozen where it operates specific business lines, narrower focus has clearly become preferred.

"You can't take a shotgun approach in putting marketing dollars behind every product or service," said Carl Camden, senior vice president and director of corporate marketing at Keycorp. "The 6 o'clock news is a great place to be if you are doing general advertising. But if you're trying to reach smallbusiness customers, they are not going to be home watching then."

Indeed, banks have become demographic hawks. By sponsoring a local money management show, for instance, a bank could promote its investment products to a very targeted group of people. That is taken a step further with direct mail.

Banks have long seen themselves as information companies with data bases full of vital information on consumers. Mixing their own information with data like credit reports - from outside sources, they are able to target specific offers designed to build loan portfolios, increase cross-selling, and bulk up the bottom line.

Consider two recent cases. NationsBank Corp. has used such techniques to send out preapproved car loans to tens of thousands as it has aggressively expanded its auto finance business, offering attractive 100% financing at rates guaranteed for a period of time. Earlier this summer, First Interstate sent preapproved home mortgages - for up to $200,000 each - to an estimated 350,000 Californians.

Critics say that such techniques may build loan portfolios, but they warn against relying on data that could be out-of-date. Bankers acknowledge that risk exists, but say that the great majority of loans made this way turn out to be trouble free.

In any event, the days when there were few differences between banks are long gone. In the old days "the game was to talk about your hours and to mention a few basic rates," said Grant O'Neill, senior vice president for retail advertising at Charlotte, N.C.-based NationsBank.

The acceptance of targeted marketing will only accelerate with interstate banking, leaving those wary of change behind, these marketers warn.

"Today, it's fact-based marketing. There's very little seat-of-thepants m your strategy," said Biff Motley, president of the trade group Bank Marketing Association and executive vice president at Baton Rouge, La.-based Premier Bancorp. "At the end of the evolution - and it may be 10 years from now - banks will be as good at marketing as auto companies or good[s] packagers."

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