Greg, optimizes SEO, PPC campaigns, and website conversion rates for a living. He is located in the San Francisco area and is clearly as passionate about analytics as anyone you will ever meet in our little industry.
You can see his full comment on the SEO wizard’s page for identifying the keywords that should be prioritized for SEO through analytics (will need to scroll down). Below is an excerpt to hint the direction in which his recommendation is going:
“Further, if a page from our site appears in the middle of page two of the search results, and later due to some great SEO work it moves up two positions, that is not going to increase the number of visits very much.”
Therefore, some ‘SEO feasibility’ analysis step needs to be part of the effort of picking the keywords on which you will bet. And Greg also says the following based on his insider knowledge of the SEO profession:
“Most SEO folks know about the importance of getting links to your web pages, and they have lots of clever ideas about how to get them. The key is web analytics. We want SEO work focused on a handful of search phrases where we will get the best results.”