One of the best ways to explain targeted traffic is through this example:
Assuming you had a website that is centered on the dog grooming niche. It’d undoubtedly be a place where your visitors could check out various techniques of dog grooming, learn about some of the common problems when grooming dogs, and so on.
Now, if you somehow ended up getting a ton of traffic, but it all came from people looking for alien conspiracy theories, well… you’d undoubtedly notice that most of your visitors just leave your website immediately since it is not what they were looking for.
Admittedly, that is a slightly wild example, but it serves to illustrate the point fairly well. Even if your visitors were looking for something more closely related to your niche, such as dog training tips, or dog healthcare tips; the end result would be the same once they discover that you are not offering what they want.
Due to this, you want the traffic that does get to your website to consist of people who actually want to learn about dog grooming and are genuinely interested in it. If you can get a steady stream of such people flowing in, then without a doubt your conversion rate would be higher.
Actually, you could conceivably obtain traffic that is even more targeted.
Assuming you have monetized your blog to sell eBooks about dog grooming, then if the traffic that goes to your website consists of mostly people who already intend to buy resources about dog grooming – well, that would be very ideal.
At the end of the day, the more tightly focused and targeted your traffic is, the greater your results.