You'd be surprised how many companies take the 'build it and they will come' approach. Well, what happens when you build a three story mall in the middle of the desert? Chances are, you won't see too many visitors. SEO put's you on the map, quite literally. It gives people a path to follow so they can find your site - and when people find your site, you have the opportunity to find customers.
Its great to have the #1 result on google, but what if you're #1 for a term no one searches for? The first step is finding out what people are searching for in your industry so you can leverage your efforts in the right direction.
If you're going up against a company who's spending millions to be number one, again...it might not be the best use of your resources to try and upstage them. But remember, even a #2 slot for a term with 5,000 searches in your area each month will give you a great boost in your traffic. It's all about being smart with your marketing efforts to create the most bang for your buck.
How do search engines determine which order to present websites in their SERPs? They have search engine crawlers that analyze the content on your website and gauge how relevant it is in relation to a user's search. This can be a sensitive subject for some business owners - some feel pages should not be too wordy, others feel without enough content you're more likely to lose a potential sale if your visitors aren't well informed. The goal is to find a balance between these two extremes by writing informative, keyword rich content that doesn't overwhelm your readers.
Search engine robots will crawl the pages on your site and index it automatically, but its also important to perform a manual submission of your site on your own. By creating a sitemap and submitting it manually you can tell search engines which pages of your site are most important.