Search Engine Optimization (SEO) - describe a diverse set of activities that you can perform to increase the amount of targeted traffic that comes to your website from search engines. (From reference book). It is not advertising, but may include an advertising component.
No one knows Google search engine algorithm except Google, all we get from internet, books, etc are from logic thinking, analysis, study, questioning, survey, experience etc.
Foundation of your search engine strategy. Keywords target searchers. Pick the wrong keywords will target the wrong people. Go to Mastering Keywords to get know how you get your keywords.
From search engine perspective, it needs a lot of text content. The more words in your site, the more pages of text content, the more times keywords can appear. Assumption: pages = lottery ticket. So, by building huge sites, hundreds of pages, with vast amount of text with keywords scattered through will increase the chances to match a search. By this assumption, you may create thousands of pages and hope that some of the text matches searches now and then. Those pages are optimized for specific phrases that you know are used frequently.
Pages must be optimized to get the most out of the keywords. If search engine finds the relevant keywords on your page, that's good. If finds the words in the right places, then really powerful thing that differentiates your page from your competitors. What means right place? Example: Put text with keyword in <h1> Tag and bold it. (Get more reference at SEO Web Design)
Submitting information to the search engines telling them where your pages can be found and asking them to come to your site and index it. For efficient, using site map for Google, yahoo. Place file 'sitemap.xml' into your website root directory containing a list of links to all your pages, so search engines could easily find them. (Get more reference at Url Submission)
Links pointing to your web site are incredibly important in a competitive keyword market. Every site needs at least some incoming links which pointing to your site from other sites. Links are so important, in fact, that a page can rank in the first position in any three major search engines, even if the page does not have the keywords that have been searched for, as long as links pointing to the page have the keywords. (Get more reference at Page Rank Algorithm)
Age is critical because the older the site, the more credibility the search engines give it. Come down to this: the longer your domain has been registered, the better; the longer your site has been up, the better. So, register your domain as soon as possible even only few pages. Get some links pointing from others sites to your sites as soon as possible.