There are three basic types of business objectives you can try to meet with your site.
Sometimes you can measure these objectives directly. Other times you will need to measure some other activity. Here are some items that are often used to measure website effectiveness, along with Wally's comments.
Hit Count - hit count actually measures the number of files called for display. That means it can be many files per page and a different number of files (and hits) for visitors who are loading graphics and ones that aren't. In general, their inaccuracy makes Hits an awful measure for most business sites.
Number of Unique Visitors is a good measure of the number of folks who actually visit your site.
Time on Site is a decent surrogate measure for how interesting your site is.
I like behavioral measures like downloading files or requesting information via forms or autoresponders.