What is Progress in SEO?
Back in the day, folks used to brag about how many "hits" their sites had. How times have changed. If you met such a fellow today, you have my express permission to laugh him right out of town.
Very few sites make money out of people coming for a look around.
Money is made when people actually buy something. This in marketing terms in known as "a conversion". And conversions are your most important metric.
Of course the aim of your site may not be to sell things. It may be to get folks to sign up for something or to complete a form. It may be a combination of all 3. But it can still be helpful to set yours site up with primary and secondary (and tertiary if required) conversion goals, and to aim your site at getting people through those processes as easily as possible.
How long should it take?
I have read somewhere that a 20% increase in organic traffic over a year is good progress for an SEO campaign. I have to say this sounds a bit miserly, but there you go.
Tracking changes
For free: Google Analytics - Clicky - ClickTale (?)
What analytics can tell you and what they can't.
Why rank/numbers isn't/aren't everything.
To this end, read the ongoing debate at web-master-world about how Google fell out with WebPosition Gold and whether that's a good or a bad thing.
What is important to track & increase and what is not.
