Meet Epsilon’s New CMO: Interview with Steve Cone

Speak to Steve Cone about marketing and it very quickly becomes apparent that direct response advertising runs through his veins.

Cone was recently named CMO of marketing services firm Epsilon. It is his third stint with the company.

He contends that advertising creative was better in the 50s, 60s and 70s than it is now because product and service benefits were spelled out more clearly and calls to action were more prominent.

“Effective advertising also must include a compelling reason to respond,” he said. “That doesn’t mean just slapping your phone number or your URL on an e-mail or a direct mail piece or a print ad,” he said. “It means putting it there and telling people how to respond. To those of us who consider ourselves direct marketers, this seems pretty elementary, but it’s not done that much.”

He added: “The vast majority of advertising today is hard to read, hard to comprehend and hard to respond to—a lot of it is art director hubris.”

Having little to no patience for self-indulgent art directors is a classic direct marketing trait.

Cone also published a book in 2005 called “Steal these Ideas,” which besides being a clear reference to 60s radical Abbie Hoffman’s “Steal this Book,” is aptly titled—even if unconsciously. Old school direct marketers are arguably in the one profession whose practitioners commonly keep so-called “swipe” files, or drawers of direct marketing pieces from other companies from which to steal ideas.

Cone has got another marketing book, “Powerlines,” coming out this year.

[Editor’s note: When Cone gave me a copy of “Steal These Ideas” last week, he signed it with an inscription wishing me and DM News the best in ’08. DM News? Steve. Steve. Steve. You’re killin’ me, man. DM News is one of my competitors. I left that rag in 2003 to work for the New York Sun, and then moved on two years later to Direct and Multichannel Merchant where we launched this newsletter. This is the second time since I left DM News someone has mistakenly put me back there. Apparently working at DM News is like getting a case of herpes. You just can’t shake it.]

In any case, Cone’s first stint with Epsilon began as a part timer while in college in 1971. In 1987, he went to American Express. In 1990, Cone helped orchestrate American Express’ purchase of Epsilon to upgrade Amex’s customer database. He also later helped orchestrate Amex’s sale of Epsilon to venture capitalists.

A couple sales later, Epsilon’s current parent is Alliance Data Systems.

Cone has held CMO positions at Citibank, Keycorp and Fidelity. He came back to Epsilon in July.

Though Epsilon became well known in e-mail marketing circles when it acquired Bigfoot Interactive and DoubleClick E-mail, what is now known as Epsilon Interactive offers Web site design services, creative services and direct mail services, as well.

Epsilon is also a multi-channel database marketing services provider. Clients include Hilton Hotels, Verizon, Barnes & Noble, KeyBank, Pfizer, Nestle Purina PetCare Company, AstraZeneca and Midas.

The company also owns Abacus, a co-operative database containing the buying behavior of customers of more than 1,500 catalogs.

“We’re not just a database company, we’re not just an e-mail marketing company,” said Cone. “We’re a full-service 21st century marketing company. We do every service a company needs to interact with customers properly, and we manage it in house.”

Meanwhile, besides deeming advertising creative better in the 50s, 60s and 70s than now, Cone also believes most marketers have their priorities upside down.

Not backwards, upside down.

He even draws an inverted pyramid in the air with his fingers when he explains: Most of those in charge of branding and selling their firms, said Cone, start by slicing off most of their budgets for general media advertising to masses of prospects. Then, he said, they see if they have a little left for direct marketing to customers, then—and only rarely—do they see if they have a little cash left over to market to employees.

“In fact, the pyramid should be reversed,” he said. “Your first constituency should be your employees so they know exactly what you’re in business to do, and exactly why your clients should be serviced in a way that will delight and amaze them. Point two should be to determine how to create greater loyalty among current clients, how to attract more and what it will cost.

“And then, if there’s any money left, you should be doing broad-based advertising,” he said. “The vast majority of companies do it the other way, which doesn’t make any sense.”

When asked what differentiates Epsilon from all the other marketing service companies, Cone said: “We do the math and we do the marketing. We’re a collection of left-brain, right-brain individuals working together for the benefit of our clients, and we’ve been doing it since 1969. Most people have a tough time getting technology people and creative people to work together, but that’s how we started and that’s how we’ve been doing it ever since.”