I've been maintaining a small site for my father. He wants to constantly know the number of hits he gets per month. I talked with GoDaddy support and they said that their stats show the number of hits, based on 1 hit is a single IP address. Therefore, if someone views multiple pages, it will only register as 1 hit for the day.
So...just to check that theory, I added Google Analytics to the site, on the recommendation of GoDaddy support.
While GoDaddy says that in December there have been 865 hits, Google Analytics registers just 43 sessions, from 13 individual users with 111 pages viewed.
Why can't GoDaddy give reasonable statistics? This isn't just off a few percent...this is thousands of percentages off.
I wouldn't personally pay too much attention to the hits, though it's the term that seems to have stuck in most folks minds. I would pay more attention to visits. As far as I am aware a hit is a click on a button, a menu for example, a click on a link etc. So someone who went on your site and kept clicking back and forth between pages would clock up some mighty hits.
Whereas a visit, is a visit. You can also see who are returning visitors by excluding 'unique visitors' or vice versa. Hits do look more impressive than visits though! Maybe that's why the idea has stuck.