I've been wondering this question for awhile. Do visitors actually use TAGS to browse your posts? I'm pretty convinced that TAG CLOUDS are not very useful and most visitors don't bother using it. What do you think?
Even if users don't use the tag cloud to actually navigate, it can provide a quick overview of the sorts of topics that the blog discusses, and hence whether it's worth their time to explore further. Plus, they are pretty.
I have noticed some of my visitors come through tags via google. It's like a keyword if you will. Ill see the referring link as mysite.com/tags/tagshere So they are doing something. =)
I have found no use for Tags. If you use a cloud I guess that make more sense but I honestly think they are useless.
IMO they do. Tags probably go one step more than categories. I wouldn't add everything as a category, for then there would be too many of them. It would clutter my sidebar and make navigation terrible. Tags come in handy at this time. If I was writing a Premiership post ( category) about Mike Ashley, I could use the tag Ashley. I know the chances of writing about him in the future are slim, and so I can't be bothered to write an entire post on him. The tags enable the visitor to know that I did write something where Ashley was the principal subject. Thoughtpunk makes a valid point too. Google does index those pages, and they can rank well.
The best example for tags is wordpress.com - their tags are ultra powerful in Google & SEs. Tags are awesome in regards to SEO and like others have said Google loves them, there's been a fair bit of debate about tags in major sites and the way in which they are used to game search engines, typically a few major competitors are p1ssed off because of the value placed on tags. Do users use them ? depends on the site - but for navigation they can be effective, possibly depending on the placement of tags. So yup you can generate pages quickly with tags, you can effectively game Google, get additional links in Google and Generate traffic - so they are useful - but visitors using them ? it depends.
I wanted to add another suggestion to this. It's not going to hurt if you do decide to use tags. If your using wordpress just copy your keywords from your posts and put them in your tags, assuming you are using a SEO plugin for keywords. It only takes a few seconds. I'd say its worth it. It's better than not using them.
Yes, tags work well, IF you tag posts in right way. Depends on the blog, I just set noindex for category ,and do index for tags. That way, tag page will be content rich to Search engines, and will have good rank actually. So if you use it with knowledge, as thsadmin said, it can be very powerful.
I grab quite a few visitors via tags, when used properly they are great for internal management as well as SEO and external keyword rankings.