Dominion Enterprises: The Unwieldy Conglomerate

Scrolling through my RSS feeds this morning, I noticed on DealerRefresh that Dominion Enterprises acquired another company, definitely not surprising, but I think it’s interesting, in light of their recent history. I am not sure if anyone has ever dealt with Dominion Enterprises, but they are one of oddest run companies that I’ve ever come across.

They own a large number of web properties and classified sites, including: Cycletrader.com, Boattrader.com, Boats.com, Forrent.com and a slew of others (I think over 70). What’s weird to me is that the individual properties almost never interact with each other, despite some of the companies sharing the same building, and perversely, Dominion actually forces companies to actively compete against each other.

A little Dominion Enterprise History, first though. Dominion Enterprises emerged from what was Trader Publishing. Trader Publishing was started as a joint venture between Cox Enterprises (the parent company of Manheim) and Landmark Communications back in 1991. Over the years, Trader grew through internal growth and acquisitions from $150 million in annual sales to $1.3 billion.

In May of ’06, Cox and Landmark decided to end this relationship and two new companies were created. CoxAutotrader gained control of all of Trader’s Auto classifieds, which included sites like Autotrader.com, Automart.com, and Autoextra.com. Dominion Enterprises, Landmark’s company, gained control of the non-auto classifieds and other companies. Including, Boats.com, Boattrader.com, Harmonhomes.com, 123movers.com and many more. Quick note on Autotrader: Autotrader is also owned by Kleiner, Perkins, Caufield & Byers, a top notch venture capital fund based in Menlo Park, California. Now back to Dominion Enterprises and examples of their quirky behavior.

TraderPublishing launched Boattrader.com in 1996 and ending up acquiring Boats.com & Yachtworld.com in 2004, a competing company. Then, in 2007, Dominion Enterprises launched Yachttraderonline, a competitor to Yachtworld.com. All of these companies compete against each other, they aren’t even headquartered in the same location – Boats.com is in Seattle, Boattrader in Norfolk. While competition is usually good for the consumer, companies acquired by Dominion tend to stagnate. Most of the properties launched by Dominion still use the same 1990s-style web design.

The usual justification for an acquisition, or merger, is the either the efficiencies that can be gained by having two companies pool resources, purchasing, and knowledge share, or diversification of revenue. In this case, diversification is clearly not the reason, so it might be efficiencies. But based on the silo mentality that Dominion uses to manage their companies, it is unlikely you’ll see an integration of Dealerskins & Autobase, which would make sense. Instead, expect Autobase to become a less nimble company, unable to respond as quickly as desired to their user needs because of a larger corporate parent.

**Update

Check out a Ward’s article on the Autobase acquisition and read some insightful comments over at DealerRefresh.com.

7 responses to “Dominion Enterprises: The Unwieldy Conglomerate

  1. Thanks for the more detailed history of Dominion. I have added a link in my posting on DealerRefresh to this posting. You summed it up very nice!! -Jeff

  2. You say “Most of the properties launched by Dominion still use the same 1990s-style web design.” I feel their sites are poorly designed and are constantly plagued with technical problems. They’re headquarters is in my back yard, I worked there for a few years, and many of my close friends work there to this day. Every time I talk to friends who are still there I’m told about some new problem that has all of their customers angry. One of the biggest problems with Dominion (or at least certain divisions) is their employee base. Any time you search on Monster.com or a similar site you’ll see hundreds of job openings. The turnover is incredible, so to get a programmer in there who knows even a little makes the hiring manager feel lucky. Dominion is a huge company, but as far as a well run company, I’d have to say they’re way off the mark. The way in which they handle their acquisitions and overall integration between subsidiaries, in my opinion, is a reflection of executives not knowing the best way to do things…..or perhaps there’s a lot more to it that nobody knows yet?

  3. Folks, I feel your evaluation of Dominion is both unfair and factually very untrue.

    I have been a manager for Dominion/Trader since January 2000, when our family business, Dealer Specialties, was acquired by them. I was with Dealer Specialties from the beginning, spending 7 years helping to build this business. Since our acquisition, I’ve been with Dominion for 7 more years, and could talk for hours about what a great company we have. Today this business is 12x the size when acquired, with all re-authored software technology, launching new products every year. No stagnation here in terms of growth or technology.

    In terms of our decentralized organizational structure, that is very true, and is what makes us great. Individual business managers, including many who are former founders of their respective businesses, run their businesses as they see fit, pushing the decision-making process as close to the customer as possible. True, we don’t white-wash the businesses by combining technologies, or pushing down corporate decisions in a top-down manager. The result is a very entrepreneurial element, that ensures buy-in at all levels.

    Do we share technology among companies? Definitely, as fast as the individual managers see fit. In our automotive group, we share constantly between Dealer Specialties, Dealerskins, @utoRevenue, and many others. We also share sales teams and do tons of cross-selling and cross -promotion. Again, for the most part these decisions are pushed down as close to customers as possible. If y0u prefer to work in a top-down, corporate-dictated environment, we couldn’t be further from that model (by design).

    It was said that, “The usual justification for an acquisition, or merger, is the either the efficiencies that can be gained by having two companies pool resources, purchasing, and knowledge share, or diversification of revenue.” We have all seen the types of mergers that result in 1+1+1=1, and chasing all of the entrepreneurial talent away. When we find great companies to merge with, we don’t want to ruin the essence of why we bought them in the first place. In many cases, their small, agile development teams teach us all a thing or two about how to get things done.

    Lots of jobs on Monster.com? I would be concerned if there weren’t, since we’re constantly growing and seeking talent. We have an incredible group of folks, we have a lot of fun, and many more opportunities exist. Come talk to us, or talk to our employees to get additional information.

    I am sorry to those who did not have a good employment experience with Dominion, but for these stories I would argue that there are 20x as many positive experiences. Of course everyone can have an opinion, which is why I’m making a post as a product of acquisition who has been continually impressed by Dominion.

    Email me if you need further information on our great company, george@getauto.com, 800-Get-Auto.

  4. Dealer Specialties bwaahhahhahhaaa, lost so much revenue from pitiful dealer service it’s not even funny. If Dominion is anything like Cox/Autotrader.com it’s that it’s strateled with Good Ol’ Boy incompitant management. If I could’ve sold Dealer Specialties “short” as a publicly traded stock from 2002 to 2007 I would’ve been a trillionaire!

  5. Frank, it’s more likely that your inability to spell simple words is keeping you from being a “trillionaire.”

    I love it when somebody accuses another of being “incompitant,” then proves his incompetence by misspelling the word. Hah.

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