But analysts say that this is a natural evolutionary process, similar to what took place in the women s market about a year ago and among general market entertainment sites today. It s a normal process, said E. David Ellington, NetNoir s chairman. There were too many sites that launched without developing a realistic business model. Overall, the reasons for failing Web sites are a lack of a viable revenue model, a lack of a target audience and a lack of marketing intelligence. With online competition so fierce, having a glitzy site with phenomenal graphics and content is not enough.
Profits are what matters.
The question, however, remains. Advertisers have estimated that the percentage of people who click on Web banners has fallen from about 5 percent to a minuscule of about 0.5 percent. Advertisers tend to benefit more from banner ads than Web site companies, according to Rodriques. The advertiser pays the Web site about five cents for every click-through and two cents for every impression. The Web site gets paid per hit but the advertiser may get a sale from that hit.