The Business of Wellness: How Schmidt’s Changed the Naturals Game
Natural deodorant is infamously known as one of the hardest swaps to make when you’re going green with your beauty products. The switch from anti-perspirant alone has scared off many a workout fiend, while the seemingly endless journey to find a scent that doesn’t leave you doing a covert pit-sniff by midday can deter even devoted natural beauty converts.
That struggle is what sparked Jaime Schmidt, a former human resources employee, to begin her new career as co-founder of Schmidt’s, a natural deodorant that actually works. What began as a small farmer’s market brand is now a global phenomenon, with products in Target, Whole Foods, Sprouts, Natural Grocers, CVS, Wal-Mart, Costco—and more.
How did this small, handmade brand launch into near world domination, outselling Dove and Secret deodorants in its first week at Target? A combination of a great product with modern branding and ideal timing seem to be the magic formula.
Keep reading to find out how Schmidt’s went from farmer’s markets to changing the natural deodorant game.
Right Product, Right Time
When Jaime was pregnant with her son, she began to wonder about the products she was using on her body. She’d just left a job in HR and moved to Portland to pursue something new—that “something” was undefined, but she wanted to be passionate about it. “There were so many factors that went into the creation of that first product,” Jaime says. “I had a genuine desire to create a natural deodorant that actually performed, because I knew how many people struggled to find one, me included.”
So, she started blending ingredients. “Honestly, the formulations just started coming together,” she says. “And they lit a fire under me. I went into small-business mode, looking for places to sell and get feedback.”
Usually, a brand goes through multiple formulations before landing on “the one,” but Jaime says she got incredible feedback right off the bat from locals who were buying her deodorant, then in a jar, at Portland farmer’s markets. “I knew I was onto something right away—I understood a true need in the industry, and the frustration people felt when something ‘natural’ didn’t work for them.”
One thing that stood out about Schmidt’s was Jaime’s scents. “Lots of natural deodorants don’t work, yes, but lots of the scents natural deodorants use don’t work either,” she says. “I was able to develop the product in real-time, with testimonials from customers at farmer’s markets, so I could add in the scents people wanted. And people are passionate about scent.”
Not to mention that diverse scent options give more people a chance for natural deodorant to work. Yes, including sweat-absorbing and stink-alleviating ingredients like arrowroot powder and activated charcoal is key to making an effective deodorant. But the body chemistry of each individual is unique, making no one scent best at busting through B.O. Schmidt’s offerings of scents like Tea Tree, Jasmine Tea and Coconut Pineapple give more people more options for a scent to work for them.
With her scents, the modern packaging and the deodorant’s effectiveness, it didn’t take long for local retailers to begin approaching Jaime about carrying the deodorant in their stores. That, along with some blog placements and setting up a website to embrace online sales, is what really started the brand’s success, Jaime says.
It helped that she was on the cusp of a deodorant revolution when she launched her product in 2010. Between 2011 and 2016, the value of the deodorant market grew by 23 percent to $4.5 billion, data from Euromonitor show, and it’s poised to rise 16 percent more by 2021. That growth in the market, compounded with Schmidt’s unique scents, which are more natural perfume-like than the powder-fresh scents of yore, and the deodorant’s efficacy, gave the brand a leg-up from day one.
Using Sociology to Sell
With the brand’s growing success, Jaime recognized its potential. “Once I realized that this could go somewhere, I had goals—I have a competitive streak!” she says. “After that first sale, I was like, ‘We’re going all in!'”
But the transition from working in human resources to managing a burgeoning consumer packaged goods brand wasn’t seamless. “I learned as I went,” she said. “Part of the process was that I was finding my identity—I’m a maker. When our first retailer asked me for a line sheet, I didn’t have one. I had to figure out how to do this as something beyond a hobby.”
What Jaime did know was people. Her time in human resources and her master’s degree in sociology helped her understand what people wanted, and she built the Schmidt’s brand around being both effective and aesthetically pleasing. She understood that brand loyalty and taking care of her customers would go far in the long run.
Jaime also understood the value of seizing every opportunity at the beginning. In order to scale, she took the Shonda Rhimes approach—she said yes to everything. “If it was a farmer’s market with two people, I was there,” Jaime said. “The goal was to make the product as available to as many people as possible, so I never turned down a chance to sell.”
That concept led to the company’s current tagline, “The new face of natural.” Jaime says building the idea of accessibility into the marketing was both intentional and key to the company’s growth. “Everyone deserves clean, healthy products,” she says. “When we started focusing more money and effort on marketing, that’s the message we wanted to get across. We’re not the natural brand you think you know—we’re for everyone.”
Outselling Dove + Secret Two to One
In 2014, Schmidt’s came to the attention of Michael Cammarata, a serial entrepreneur and angel investor who made his first million at 13 years old from his own web hosting business. He joined the Schmidt’s team as an investor and co-founder with Jaime.
Until this point Schmidt’s was sold in natural grocery chains, and small beauty boutiques and spas, but shortly after, the company piqued the interest of national grocery chains and discount retailers like Target and Wal-mart.
“We couldn’t forecast our growth,” Jaime says. “It was so exponential, we had four different warehouses in two years to keep up with it. We couldn’t determine the amount of raw materials we’d need, so we had to get creative and source backups.”
When the brand launched in Target in early 2017, they couldn’t keep the stock on the shelves, Jaime says. “It took a long time to catch up with the demand. We were outselling Dove and Secret two to one.”
A Mutually Beneficial Partnership with Unilever
It wasn’t long until Schmidt’s began to receive inquiries from the team at Unilever. “When they reached out to us,” Jaime says, “they told us they’d been keeping an eye on the brand, and they’d had our products in their office for a few years.”
Unilever, the global company that owns more than 400 brands, realized that naturals wasn’t going away, Jaime says. “They own all these heritage deodorant brands [like Dove and Axe], and so they were paying attention to how our brand was creating an impact.”
She says that though Schmidt’s was smaller, the community the brand had built wasn’t something Unilever could replicate. “They could break down our formula, but they couldn’t replicate our brand,” Jaime says. “Our brand and our success was because of the community we’d built. And they couldn’t compete with that.”
The timing (2017) was great. At that juncture, Schmidt’s had already been approached by private equity, venture capital and other large companies for acquisition. “We were at a point where we needed to sustain the business with more capital,” Jaime says. “Unilever felt like the right fit right away. They wanted to keep the important things about Schmidt’s in tact, because they couldn’t do it better. And partnering with Unilever gave Schmidt’s more and better access to supply chains and new production avenues.”
On top of that, Unilever team executives stressed that they had an interest in learning from the Schmidt’s team about customer acquisitions and digital marketing tactics. “We’d been exploring new ways of using digital marketing, like geo-tagging, and they were excited about getting that from us too,” says Jaime. “We’d been able to pivot a little easier to respond to our customers’ wants, because we were smaller, and that was intriguing to them.”
Even though Unilever was the right fit from the Schmidt’s team perspective, they still had to manage expectations and pushback when the announcement was made. “We needed to give our customers reassurance that the products wouldn’t change,” says Jaime. “We helped manage all the feedback and the transition because we didn’t want to hide behind it. We wanted to own [the acquisition]. We helped consumers to have all the info they needed to understand what was happening.”
Jamie’s Advice for Entrepreneurs
Now, more than a year after the Unilever acquisition was announced, Schmidt’s is doing as well as ever. They’ve launched new products, including a liquid body wash, and have continued to grow, with an estimated $90 million in sales in 2017.
Jaime too has transitioned. She’s no longer the company’s CEO (Micheal took over that role when the company sold to Unilever), but she maintains a brand ambassador job that allows her to be a spokesperson for the brand, reassuring consumers that Schmidt’s will hold true to its original mission. “I’m no longer in the day-to-day operations,” she says, “but I’ll always have some involvement.” She now travels around the country to speaking engagements, and has recently started a private equity firm, called Color, with her husband. “We want to support diverse, socially disadvantaged founders in the consumer packaged goods arena.”
She hopes overall to be able to give back to and support the makers community that she started Schmidt’s in. Part of that is sharing her advice for budding entrepreneurs. “Don’t be afraid to ask for what you want,” she says. “Whatever it is—see how you can make it work. If it’s with a supplier and you can’t afford all the raw materials, negotiate the payment terms. If you don’t ask, you won’t know what’s possible.”
Jaime also notes to anyone who’s in job they feel stuck in, and are daydreaming about quitting to leap into their side hustle: “Find value in every experience. We get caught up in job we don’t like, but you can always find something you can learn and use in your next venture.”
And, take time to document everything, Jaime says. “Take photos, journal, photograph the disasters! You might feel like you don’t have time, but that can become great content for you to use, and it can help tell your story. I wish I would have done that more—there was a time when we dropped packing peanuts in the street and they were blowing away. I wish I would have taken a picture! It’s comic relief for the times when being an entrepreneur is tough.”
Interested in how other brands have made their mark? Here’s how another deodorant brand turned down their Shark Tank deal—and still grew 1000 percent.