If you've ever done a user survey on your web site, you'll probably have found that the commonest complaint that people have is that they can't find whatever it is that they're looking for. That's pretty sad, but it still represents only the tip of the iceberg.
If people can't find what they're looking for when they're actually on your site - i.e. at least Aware or even Informed in Awareness Cycle terms - what chance to they have of finding you or your products, if they're Unaware of your existence?
Search represents the status quo on the web today. Where previously people memorized and book marked URLs ...
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today, they're much more likely to use a search toolbar to find the site they need, even one that they've visited before ...
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This is not a problem if - like me - you have relative exclusivity on a name and get good default search results. However, if your company name - e.g. Better Widgets, Inc - has similarities with your competitors' names (Bigger Widgets, Inc), or if your competitors are deliberately optimising their own search result rankings, then default just might not be good enough!
See for example how LinkedIn, Amazon and AboutUs are all getting good rankings for a search on my name in the image below. In the case in point this is not a problem, because all are providing (directly or indirectly) relevant information about me, but it could just as easily be a competitor trying to hijack my potential prospects. [FYI - and in case you're wondering why I don't comment on it, must-sell-buy.com is a domain I own, which at the time of writing hosts a mirrored version of this site]

I'm no expert on the details of SEO, but you can find some additional material on the subject here.

Until recently, this was a great, low cost way of advertising your wares to people who were actually searching for them. It was - and still can be - incredibly effective if done properly. You need to know, however, that the rules of the game are currently (January 2008) in flux. Google's understanding of content and how to match textual and advertising content is fairly awesome - it's effectively Google's licence to print money! As a result - and because Google only earns money when someone actually clicks on a displayed ad - stringent monitoring and competitive forces have been introduced.
Whereas before search engine advertising could be used as a substitute for content optimisation - just buy the ad to display alongside the search results, even if your pages didn't rank well - it is probably now just as important to ensure that your (landing) pages are properly optimised for the ad keywords that you've booked. It may soon be just as easy to do SEO, as to book relevant advertising at a sensible price-per-click.
Whether or which, landing page quality is vital in this area too. [See SEO Tips for a related discussion]. It is rumoured that Google particularly likes well-defined Conversion Points on the linked pages - especially Buy buttons! And, as with any other content, constant monitoring of the effectiveness is recommended.
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The guidelines for Site Search are as follows:
But don't just rely on site search to allow the user to find what she's looking for. Using the Customer Activity Cycle as a basis, ask yourself what the customer might be trying to achieve, what information she's looking for, what related documents could help. Consider issues such as