Hi Ani,
judging from what you have told us, I would say this is mainly a usability issue. In fact the 1st website is not very appealing in terms of colour scheme - that blue is just too strong for anyone from my point of view. I think that is a major draw back.
But you need to go further than that and use some sort of analytics to understand just what users are doing when they reach your site - typically Google analytics for a free evaluation of ask yoru SEO for some more in depth analysis with tools such as clicktracks.
Hope this helps
