Hello, I'll try to give you a basic overview of how search engines work so that you can better understand how SEO works - there are entire books and forums dedicated to explaining this subject matter so I'll try to keep is as short and informative as possible.
As of today, there are over 130 million websites registered on the internet, to filter through all of them most of us rely on search engines to get what we want.
When you search for something on the internet using a search engine you get a results page with a list of websites that are relevant to what you're looking for, in most cases - users only consider to observe the results that their favourite search engines display on the first page, they don't bother to look at the other pages. Instead, they prefer to restructure their search and start from scratch - most people who click on the first page often go for the first 3 items in the first results page.
This is why optimizing your web site for search engines/ SEO is very important. When people search for something that's relavant to them and your website shows up in the first page of the results, they're most likely to visit your web site - and these aren't just any visitors, these are people who are looking for exactly what you offer. So they are more likely to be possible clients or subscribers.
But if your website doesn't appear on the first result page - it's as good as your web site not existing to possible visitors. A website's position on a search engine result page is determined by what's referred to as Page rank, every website has a ranking for particular search terms/keywords. So search engines rank your site based on the number of keywords in your site and the number of backlinks from other sites to your site. So think of it like this, keywords let search engines see your website and know what it's about, backlinks determine how relavant your web site is to the search query.
So there are 2 corresponding components to SEO:
#First - the on site component. This is where you ensure that your site is full of keywords that are relavant to what your site is about. So for example, if you're selling muffins in Pretoria: in your sites keywords you would want to include words such as "muffins, muffins in Gauteng, muffins in pretoria, etc"
#Second - the off site component. This is where you work to create backlinks to your site that originate from other sources. Links to your site can be created using social media, blog posts, articles, etc. But keep this in mind, the more influencial that the site is that has a link to your site, the more effect it will have on your site's Page rank.
So that's it, SEO is important because it helps your site's page rank move to the top. Good SEO takes time to achieve, so the sooner you start - the better your results.
If you need more information, don't hesitate to ask.