One can over-analyze or under-analyze any website. Some people spend too much time checking stats, analyzing, and planning, and don't spend enough time writing good content and getting new readers to their blogs.

1. Find out which of your website's pages are getting the most traffic, and optimize those pages.

If you are running ads on the pages, make sure they are properly placed and updated. If you are linking to affiliate products, make sure your links are up-to-date and that you aren't missing any links, or new products which should be there. If you are using that page for some other purpose, such as to generate subscriptions or whatever the case may be, make sure that the page is laid out as well as possible. This can be helpful if you have a large website which has a long "to do" list and many things to optimize or tweak. By just starting with the most heavily-trafficked pages, you will get the maximum results from your efforts and also know where to start.  

2. Find out which referrers are generating the most traffic, and continue any actions you have been taking to generate traffic from those referrers.

For example, if you see that Twitter is generating a large amount of targeted traffíc, you can expand your activity on Twitter. If you see that your article submissions are getting new visitors from article directories, you can make a note not to drop those out - or possibly step them up. Conversely, if you see that you have been spending time/money on a traffic-generation method which is not getting very far, you can stop wasting your time on it (presuming you have given it time to take effect).

3. Find out which keywords you are ranking the best for, and see which ones you can "push to the top."

If you had a website on dogs, for example, and found that you were ranking at #30-#40 on Google for many keywords, but ranking #11 for, lets say, "dog chew toys," you might want to work on increasing your rankings on dog chew toys and focus more of your SEO efforts on this term (of course there are other factors you would consider as well, such as the searches and competition for this term). Climbing from position #31 to #20 will generally not get you a huge improvement in traffic. But climbing from position #11 to position #3 almost certainly will. Focus first on keywords or key phrases that have the best chance of ranking high in the near future, and then move on to the others.

4. Find out which pages keep your visitors' attention for the longest.

If the average visitor on Page A stays for 5 seconds, while the average visitor to Page B stays for 150 seconds, the likelihood is that your visitors find Page B's content more interesting than Page A's.

5. Look at the graph of your bounce rate.

This tells you how many people left your site without visiting a second page. Depending on the website and the page, this may be a good or bad thing. But if you have a blog or a content site, it is usually a good sign when people stick around to view more of your posts and content before they leave. If your Bounce Rate increased or decreased after you made a certain change, you can opt to revert that change (if bounce rate increased) or keep it (if bounce rate decreased). For example, if I changed the theme of my Wordpress blog and then noticed a date-co-incident jump in my bounce rate, I might consider changing it back :) This statistic can be used in many ways - it will depend on the nature of your blog.

There are many, many other ways to use Google Analytics. The above are great ways to start, if you aren't familiar with or used to using this tracking system. Google Analytics can give you a far greater understanding of what's happening on your site and can guide you to continue on successful actions and drop the unsuccessful.

So if you haven't started using Google Analytics on your website(s) or blogs, I highly highly recommend it. If you've set up an account but rarely look at it - I recommend you start looking