Dominion Enterprises' purchase of PowerSports Network and ARI Network Services Inc.'s buyout of OC-Net Inc. could dramatically change the e-commerce segment to the potential benefit of dealers and suppliers.
The acquisitions have created two major providers of Internet services, each with strong capabilities in lead generation and tracking, and online catalogs of OEM machines, parts, apparel and accessories, plus aftermarket products from distributors. (A third provider, Duluth, Minn.-based 50 Below, provides similar services.) Combined with the MIC's Powersports Standard Protocol initiative and Kawasaki's new focus on e-commerce, the industry could see major improvements in the way suppliers, dealers and consumers conduct business over the Internet.
Wisconsin-based Powersports Network (PSN) claims to be the largest website service provider in the industry with more than 2,100 dealers running PSN-powered websites. Dominion is expected to continue to feed PSN's growth through capital investment and technology improvements in such areas as lead generation, Internet search optimization and cross-selling between groups of customers.
Dominion Enterprises is a $850 million company that owns 40 websites — including CycleTrader.com, RVTraderonline.com, BoatTrader.com and Boats.com — and more than 500 paid and free magazines. Its 6,600 employees collect data and operate a variety of services for dealers. Dominion, in turn, is owned by Landmark Communications, a large organization based in Norfolk, Va., that's best known as the owner of The Weather Channel but which also has extensive holdings in newspaper publishing, broadcasting and interactive media.
Dominion's purchase included PSN's building in Sussex, Wis. PSN's three founders — Nick Avgoulas, Kevin Brandenburg and Steve Weiner — plan to stay on for at least a year, according to Avgoulas.
ARI's acquisition of OC-Net isn't as large as the PSN-Dominion deal, but it is nevertheless worth watching as it brings together a small, innovative website developer with a $14 million international provider of online OEM parts information.
California-based OC-Net was founded in 1996 by Robert Hipp to provide website development for dealers. Its largest customer is Yamaha. OC-Net had only about 100 dealer customers at the time of the transaction; ARI brought in another 400 dealers plus relationships with Arctic Cat, BRP, Kawasaki and Suzuki, according to Hipp. (continued)