ll be selling advertising space to those interested in selling vehicles.
However, itcars.com also recognizes that the competition for this market is fierce, and that individuals can post their used car advertisements on other sites for free. The business model that the company has adopted for the Internet is therefore to form alliances with insurance companies, lenders and car dealers for advertising on the site and provide free classified ads to individuals. In this way, the site will become the "first stop" for those seeking automobiles (although most consumers will not be frequent visitors because of the infrequency with which auto purchases and leases are typically made).
Revenue will be generated by the contracts with the business partners (lenders, insurance companies and dealers) of itcars.com who stand to make the most revenue from the site themselves. This revenue will be based on a contracted agreement rather than a cost of click (COC) structure. As the site grows in appeal and generates more "hits" for the business partners, the agreements can be expanded to include nationwide businesses and the contract rates will increase.
This revenue structure will ensure that itcars.com has adequate cash flow to meet its promotional budget, which will be significant in order to generate traffic. The site will only be successful if advertisers and individuals alike are able to realize revenue from it, so generating traffic and maintaining an effective site is critical. This also means that the site must be "up" 24 hours a day, seven days a week, and that it is updated on a regular basis (throughout the day) as ads are added and deleted.
Additional revenue will also be generated through banner ads which will offer links to auto shows, car clubs, auto parts dealers and other advertisers interested in reaching car buyers. Because this is an already segmented Web site as opposed to a general portal, the cost per thousand ...