SEO stands for search engine optimisation.
On Wikipedia we find the following definition:
Search engine optimisation refers to measures that serve to increase the visibility of a website and its content for users of a web search engine. Optimisation refers to the improvement of unpaid results in organic search engine rankings and excludes direct traffic and the purchase of paid advertising. Optimisation can target different types of search, including image search, video search, news search or vertical search engines.
How does a search engine work? See a video below.
93% of all online experiences start with a search engine, 68% of which use Google.
Combine that with the fact that the first 5 search results get 67% of all clicks and you can well imagine why SEO is so important.