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American professor Dr Eric K Clemons has claimed that blue chip companies need to follow some simple steps if they want successfully promote their products to niche markets.

Dr Clemons is a professor of operations and information management at the University of Pennsylvania.

Here are five steps to niche marketing success.

1. Target Carefully

Niche marketing isn’t about creating a product that is better than every other competitor. It is about specifically creating a product which is different from existing options for one type of customer.

Obviously this is easier said than done finding profitable niche markets are a tricky business. You should look for markets where no product offerings exist, not markets where customers are dissatisfied with what is currently on offer.

Dr Clemons sites Toyota's successful marketing of Lexus line of luxury cars as an example.

The car manufacturer spotted that there was an untapped market in America for Mercedes-quality luxury cars but at a lower price. Rather than compete with the likes of Mercedes by creating a superior quality car at a comparable price Toyota developed The Lexus line to offer quality at a price that buyers could afford

Toyota identified an unmet need and success was instant. The key to this success was extensive research.

Conventional advertising strategies don’t work for niche markets - they're far too expensive and not direct enough. Get creative, examine your research and give your target audience what they want.

Look at Nike’s Joga Bonito football-oriented social network service. It detracts from the traditional multi-million pound beer-swilling male orientated game by portraying itself as an underground broadcast channel which displays the skills of celebrity football stars as an art. It directly taps into the younger online generation’s viral mindset and moves away from football’s sometimes-yobbish image.

2. Control Production Costs

Dr Clemons has said that companies should sell a large number of narrowly targeted products if they really want to tap into a niche market. He also acknowledged that while this may sound daunting it doesn’t have to be problem.

"Variety and standardization can coexist," he said.

Standardising manufacturing processes is the key to successful niche marketing.

Dr Clemons explained: “While pumpkin spice ice cream appeals to a very different group of consumers than vanilla does, the manufacturing process is nearly identical for both flavours and any others. Brewing involves cold-fermenting lagers in one set of tanks and warm-fermenting ales in another, but the two varieties share many other processes: mashing grains, adding hops, bottling."

Companies can bring out a range of different interesting products with minimal expense. Look at Ben and Jerry’s snatching the US –style ice cream market in the UK.

3. Control Distribution Costs

With niche markets it can be difficult to predict which of your products will be the latest craze but you obviously don’t want to be creating far too many products that won’t necessarily be used and will have to be stored.

However, if you have standardised manufacturing systems or products which are made up of shared components like mobile phones postpone the final creation of the product until it gets ordered.

Shared distribution is another way to get your niche products out their. As a blue chip company you will have a number mainstream products or services – why not add a small amount of your niche product to your driver’s delivery list?

Selling directly via a company website also reduces cost as it takes out the middleman.

4. Some poor products are worth keeping.

Before discontinuing a product that appears unprofitable or only slightly profitable consider its value in wider terms

"Some products that don't generate significant profit directly still help make a company's other products more profitable. Feeder routes on airlines transport customers to more-profitable routes, such as trans-Atlantic flights. Likewise, niche books that don't account for a significant portion of Amazon.com Inc.'s sales are valuable to the company because they contribute to its reputation as a one-stop source for any book,” said Dr Clemons.

5. Don’t be afraid to cut products.

Any target product that doesn’t contribute to your niche market profitability directly or indirectly should be cut loose.

Going back to Ben and Jerry’s – hundreds of its flavours have been discontinued over the years.

The ice cream giant remembers all the abandoned lines fondly on the company's website. This highlights to all businesses that creative expansion can be achieved by eliminating products that have stopped resonating with consumers.