When the World Wide Web was young - or at least younger than it is now, most of us found what we wanted on the internet through directories. The most well known is Yahoo. The information on the site is organized in categories and subcategories, eventually 'drilling down' to a backlink to the sites that fit the categories. Webmasters still use directory submission to drive traffic to their website. However, directory submission traffic is different than search engine traffic - and with different benefits.
A search engine, which is more commonly, used today, searches websites to look for the best match based on the keywords that the internet user enters. The user often has to then scroll through the returned website links and pick the one that seems most likely to get them the information they need. Of course, webmasters use a number of backlinks, SEO targeting techniques and other strategies to drive their site to the top of the search engine list, so that the internet user sees the most popular sites - not necessarily the ones they are looking for. As a webmaster, the idea of using search engines is to drive a higher quantity of visitors to the site, hoping that some of them will stay, buy, or join or site.
With directory submission, the process is a bit different. The internet user is, in effect, their own 'search engine.' They go to the directory site and choose the category of information they want, then continue to choose sub-categories until they arrive at the list of sites - all of them backlinks - that contain what they are looking for.
For example, if you were to put the keywords 'graduate school' in a search engine, you will get sites related to the schools themselves, the top degrees, how to pay for graduate school and more. But what in a directory, let's say you would start by clicking on the broad category of 'education.' Then you could select 'graduate education,' then 'universities,' then the state, city, and finally arrive at the schools in the area you want with the kind of education you want. The result for the visitor is a more specific list of websites for the type of information they want. The benefit for webmasters is that when the visitor clicks on your backlink from a directory, you know that you are getting a targeted visitor. They specifically want a website in your category, and you will likely get a higher percentage of these visitors to convert to a customer, client, or member of your site.
The important thing to remember here is that directory submission is a technique that focuses on the quality of the visitor you receive - not the quantity. It will take some additional work to find the right directories for you, but in terms of targeted traffic it will be worth the effort.
When you look for directories to submit your website to, be sure that you assess them carefully first. Follow some of the category progressions to make sure that they make sense. Going from 'education' to 'diet pills' is not the kind of category progression you want. Make sure it's logical and that sites with irrelevant content are not listed in a category where they don't belong. This would only create lousy backlinks, making search engines - and worse, visitors - leery of following the directory's backlinks.