Having won promotion with Villa and kept the club in the Premier League, Smith signed Watkins again, this time from Brentford for a then club-record transfer worth PS33 million in 2020.
"Everybody at Villa was on board with it, even though the figures kept going up and up," said Smith. "I knew that would be the case because I knew how much Matthew Benham, the Brentford owner, rated him. He actually said to me 'Ollie will be your best player at Villa'. We had Jack Grealish at the time, so I replied by saying 'I think he'll be my second best player!'"
'He used to beat himself up and dwell on things'In just his third Premier League game for Villa, Watkins scored a perfect hat-trick in the 7-2 demolition of a Liverpool team, in which Netherlands defender Virgil van Dijk played.
"That certainly helped him settle down and feel like he belonged," said Smith. "But I thought the most important game was the friendly behind closed doors we played against Manchester United just before the season started for us. He scored in that game as well and I think that settled him straight away among the group."
While on England duty, Watkins has spoken of experiencing imposter syndrome at stages of his career and Smith said: "One of his biggest strengths was also his biggest weakness. He's a big thinker about the game, but he used to beat himself up and dwell on things. Over the years, you can see he's found ways to deal with that and that's been evident in his improvement."
Watkins scored 27 goals in all competitions as Villa qualified for the Champions League before the Euros and Smith believes "application and attitude" are two of the biggest factors behind his rise.
It is understood that Watkins was superb in training between England's victory over Switzerland and the semi-final, which won him his prize as a late replacement for Harry Kane.