Reinventing a 158-Year-Old Lawn & Garden Company (ft. ScottsMiracle-Gro CEO)

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Gardening. It might seem like a highly discretionary part of the economy, but behind America's lawns, gardens, and houseplants is one company trying to make itself indispensable to consumers. That's Scotts Miracle-Gro. And so we were delighted to sit down with the CEO, Nate Baxter, fresh out of his first Investor Day as CEO this week, where he's been leading an ambitious turnaround, aiming to transform the 158-year-old lawn care company into what he calls a lifestyle brand. It's a big shift and one with few precedents. We discuss how the Scotts Miracle-Gro team now includes new media alumni to drive brand awareness with untapped demographics, why acquisitions will play a bigger role in the company's strategy, and how Scotts is trying to break from traditional seasonality with product innovation. We cover all this, plus, because we couldn't resist, Martha Stewart's role as the company's Chief Gardening Officer and as a shareholder. It's a conversation you won't want to miss coming up in just a moment. But first, this episode is brought to you by Charles Schwab.

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**Ann Berry** (2:40)
And now my conversation with Nate Baxter, President and CEO at Scotts Miracle-Gro. You know, the title change happened in June. Congratulations.

**Nate Baxter** (2:48)
Thank you.

**Ann Berry** (2:48)
How's it feeling?

**Nate Baxter** (2:49)
Feels great.

**Ann Berry** (2:51)
Same, same or different?

**Nate Baxter** (2:53)
Same, same. You know, the reality is I was out on the street with investors for, gosh, the last couple of years. The strategy we put together, we're calling SMG 2.0, was a strategy that my team and I put together. So really, it's a title change, but honored to be here. You know, the legacy of these brands is huge. And so I've got a big responsibility on my shoulders now.

**Ann Berry** (3:13)
Well, you were articulating the responsibility and talking about what that strategy is in a lot of detail. I have in front of me close to 100 pages of your Investor Day slide deck. That was just yesterday as a time of recording.
Just explain if you don't mind. Nate, you and I have spoken before, but for this specific audience, ScottsMiracle-Gro, the absolute monster in the arena of branded Lawn & Gardens. Frankly, and look, I don't mean to be cheeky, but I'm going to go there. I historically thought of this brand as highly effective, well known, but frankly, a little bit stodgy and truly looked like a, quote, good old chemicals brand. You're doubling down, tripling down on turning this into a lifestyle brand. How are you doing it? It's a very different playbook. Who's doing it and how's it going?

**Nate Baxter** (4:00)
Well, that really is the underlying thesis of this entire shift. And what I'll say is it starts with the consumer.
I think when you make the comments about a stodgy legacy brand, very true. We've been around for 158 years. I think the turf builder line was brought to market in the mid-40s, so that's an absolute accurate characterization.
But what we did internally is I posed a question to the team, and you probably saw it in the Investor Day deck, which is who are we and what do we stand for? It's a question that I felt we needed to look in the mirror and ask ourselves as we try to take this company forward for another 100, 150 years. And one thing was very clear. The consumer is changing. The consumer cares about natural and organic. They care about safety and efficacy. And so how is a trusted brand that's always been known for its efficacy, how do we pivot and lean in to that next generation consumer while not alienating our existing core consumer? Because if you look at the housing market, very low turnover right now, that core consumer is still very much entrenched in home ownership. So that's what this is about. And I do think when I said to people, we need to look at ourselves as a lifestyle brand, I got some side-eye looks for sure. But what I really meant was we have to put ourselves in the consumer's place and look at how they view Lawn & Garden today, which I think is very different than the historical consumer did. And so that's what we're trying to do. And out of that comes, well, you can talk about mental health, mental and physical wellness. You can talk about creating areas that are safe for kids and pets. And by the way, you can talk about sustainability and doing the right thing for the planet. So that was the genesis of lifestyle and where we're trying to make the pivot to.