As sure as the sun will rise in the morning, your site users are going to end up hitting a 404 error page at some point or another. But what you provide them when they hit that pages can actually tell a lot about your site, and can help turn your what is technically a fail for the user into a win, if done properly.
By definition (remember when definition was pulled from encyclopedia rather than wikipedia? I guess I am dating myself somewhat here), a 404 page is:
"The 404 or Not Found error message is a HTTP standard response code indicating that the client was able to communicate with the server, but the server could not find what was requested. 404 errors should not be confused with "server not found" or similar errors, in which a connection to the destination server could not be made at all. A 404 error indicates that the requested resource may be available again in the future."
Layman's terms, if a user try's to pull up a page that is not there on your site, the 404 will tell them that their browser can hit the site they are trying, but just cannot find the page they are looking for. Could be an old link...perhaps a mistype in the URL. There are any number of reason that a 404 page could come up.
There are a couple schools of thought about what to do with your 404 pages. But, taking a step back, the first important think is that you so something with your 404 page. Every site has different variables that lead to how frequently a 404 page comes up. If you have recently moved your site, or done some overhaul work that would eliminate or change page names, you might get a higher number of 404 pages. Depending on what your analytics tracking software is, access to how many 404 page calls you get could be in different spots, but all analytics will give you access. USE IT.
The next big question is what does your 404 page convey to your users. Some sites use their 404 pages to convey humor. From the Twitter "Fail Whale" to other clever 404 pages, these sites have decided that the 404 page will simply acknowledge to the user that yes, you are still on the site, but something is wrong, so why don't you just laugh a bit at the whole thing. Here are a couple examples:
B3ta - http://www.b3ta.com/404
Jotsai - http://www.jotsai.com/e/404.html
Jackfig - http://jackfig.com/404
The important thing to remember is that you need to take your user's sense of humor into consideration more so than yours. I have seen some really clever 404 pages...but if your site is not one where the humor fits, then you might actually alienate your users with this method.
The other stream of thought is to make your 404 page be a mini reference page. The idea here is that if your users have actually ended up on this page, make them feel like you care that an error occurred. Provide them with a couple content streams, perhaps a feedback form so they can let you know what page they were trying to access. Or create a mini site navigation so they can quickly find accurate links to the content their were searching for. This method, while less flash or entertaining that a humor based 404, really helps super server your users, which is often greatly appreciated. A few good examples:
1976design - http://1976design.com/blog/404
mezzoblue - http://www.mezzoblue.com/404
Heinz - http://www.heinz.com/404.aspx
There are plenty of good articles with examples of both kinds of 404 pages. Only you can decide which way you want to go...but if you take away on thing from this, it is that you just do one.
If you are a Platformic customer (and if not, why not?!?!) be sure you take advantage of our built in Custom 404 page setting, that allows you to make any section you want into your 404 page. Simple, easy to set up, and in 5 minutes your have yourself a custom 404 page. That's turning fail into #winning in my book