As part of our fast-track course here at Babson, we have been applying our experience and new-found knowledge to assist three start-up companies with live projects, where the company founders have a current need for assistance or further knowledge, but are constrained by limited time and resource.

Four of us, Claire, David, Amina and myself were given assignments to look at a new business, Two Degrees, who are a new entrant to the Nutrition Bar market here in the US. The market here is very congested with lots of similar products, and so the founders of Two Degrees have created a major differentiation for their Nutrition Bars by adopting a “One for One” business model. This is similar to the model adopted by Toms Shoes, which manufactures shoes in Latin America for the US market, where for every pair sold in the US, the company gives one pair of shoes to a person in poverty in Latin America.

For Two Degrees the model is that for every nutrition bar purchased in the US, Two Degrees will pay for the production and distribution of a nutrition pack to a starving child in the third world. Two Degrees have formed a partnership with Valid Nutrition, an organisation which manufactures the nutrition packs in Africa, and therefore Two Degrees has ensured that the “giving” part of the business model, not only provides a potentially life-saving nutrition pack to a child, but also gives sustainable investment to the economies of African countries. Their “tag line” reads – IS GOOD DOES GOOD. Two Degrees have also initially decided to avoid traditional retail distribution channels, which are highly congested, and concentrate their sales efforts via on-line and other niche retail channels, where they can create better product differentiation.

We were asked by the founders to look at two potential opportunities for Two Degrees: the potential market of US mothers and US faith communities for sales of the nutrition bars; and secondly the potential for Two Degrees to enter the UK market. For the US market opportunity we proposed that the value proposition for the bars should be based on a cause-related marketing basis – rather than segmenting mothers and faiths, combining  and targeting them via shared causes would give Two Degrees one high growth segment utilising online distribution as their primary channel. For entry into the UK market we identified that the nutrition bar market is also highly congested and cautioned that the market may be difficult to penetrate for a product not yet established in the US, but we presented our belief that the “One for One” model is a very compelling proposition for the UK market, perhaps with a different product.

As a group we are keen to look at the possibilities to replicate this business model in the UK.