I have never been specialized in search. I have many times worked with search specialists in various projects and I appreciate the work they do. Understanding the meaning of Google in consumer life is crucial, but SEO (or SEM for that matter) is just a part of a bigger picture. Remembering the time when clients believed that SEO is a silver bullet, I have always had my firm principals on how I approach the search:
1) SEO is competitiveness, not competitive advantage.
Making your website search engine optimized is easy for your competitors to do as well. How do you differ from them when they have are optimizing same way as you do as well? This is apparent in highly competed fields of traffic. Tabloids or online travel portals compete head-to-head and the number one search position changes hourly. Of course if you have not made sure of the basic hygiene issues, you have most likely lost the game already. Doing search well is something that is not enough to differentiate anymore.
2) You should create your content for people not for the search engines.
I have blogged for almost 10 years in various instances. Sometimes I have done tests and wrote the content more with the keyword-glasses on. What I have noticed is that good content will always become popular no matter what words you use. Some of my most read posts have had actually really mundane titles and go against all the rules of the traditional “write for search engines” –rule. Of course I know that I am not Perez Hilton or Seth Godin (or do I?), and my blog post is only a tiny-tiny-tiny fraction of what is happening in Internet in general. But so is majority of the web content. Companies should first concentrate on how they can be useful & interesting, and then think about keywords. Not the other way around. Being useful & interesting is hard and there are not short cuts to it.
3) Real Popularity is the most important optimization
Google likes content, which is popular and which is shared. After Google Panda-algorithm change two years ago, the traffic to news sites and social media sites surged whereas “content farms” really slumped (and majorly have not been able to come back). We also now that Google has increased the weight to social sharing with its search algorithm. Social media shares are harder to fake. You really have to be useful & interesting to get those shares, because they are done by real people.
These principles are still valid, and with the recent algorithm changes (like above-mentioned Panda) more accurate than ever. Google is aiming to eventually stop gaming the system and also make search to emulate more human way of searching the information. With latest Google Hummingbird there has been maybe the biggest leap in search, and the following changes will change the search game totally:
1. Security Search is now the Default: Less visibility on why your visitors are visiting your site
In conjunction with Hummingbird-algorithm change, there was also other major change in September. All the Google searches are now secure by default. Basically this means that you do not know what keywords your site visitors have used when they arrive on your site. This change was eventually inevitable, but still makes traditional SEO harder. There are also certain workarounds to try to capture the traffic.
2. Enter the Semantic Search: Forget the keywords, give answers
More and more searches are currently made by mobile and in the future increasingly with your voice (Siri & Google Glass). Traditional “googling” is not a normal way for people to find what they are looking for. We have taught ourselves to use keywords, but what we really are trying to find is answers.
Giving right answers tailored to you is the direction where Google is going. It takes account your device, previous search history and location and gives tailored search results based on your existing and expected future behavior. Some of these developments we have already seen. Google corrects your misspelled words and proposes alternatives to what you are trying to search. Knowledge graph tries to guess what you are searching on the right side under the search bar.
The search game is totally different than it was couple of years ago.
Do we still need specialized SEO-agencies or is search business nowadays mainly SEM?
Stand-Up Strategy 
The human reason of search. That is what Google is trying to do with Hummingbird and that provides opportunity for serious content creators. In other words: know your customers. Keyword data, regardless how small it may be, is just one tiny bit of information in that puzzle. Semantic relevance plays a new part in the world of Google. What are the steps after Hummingbird, now that is interesting 🙂