How Search Engines Think About Internal Linking
The links on a web page act to search engines like 'votes' and the authority of a page is influenced by these links. The more links a page has, the more votes the page receives and the more authority and relevance it is given. Your homepage typically has the most links, thus it generates the most authority. Conversely, the more clicks it takes to get from your homepage to a particular piece of content, the less authority is has, because it is further down the site hierarchy.
Creating Hub Pages to Optimise for Keyword Phrases
Assuming that you've done some keyword research and you now have a list of keyword phrases for which you wish to rank in search engines, you realise it is impossible for your homepage to be an authority on multiple keyword phrases. You are also building up lots of good content over time, but this is starting to get pushed down the site hierarchy, further away from your homepage.
The solution: create 'hub' pages to link together pages of similar content. A hub page is a single, central page to which many other relevant pages on your site can link. A hub page can be an existing page or article, or a product category page, or a new page - it can be anything. If you have an existing page that is already indexed by Google (meaning it appears in Google's search results somewhere already), this is an ideal choice for a hub page. You can optimise the page title and headings on this hub page to target a specific keyword phrase.
Now you can create links from your hub page to other relevant pages, therefore adding votes to your hub page. Remember, your links should be descriptive - they should contain the keyword phrases for which you are trying to optimise your hub page. See my link building article for more details.
An Example of a Hub Page
I have created a hub page for the topic of SEO Fundamentals to demonstrate this principle. This article is linked from that hub page, and the link in the preceding sentence links back to the hub page, therefore adding a vote to its authority.