Everybody that connects to the internet gets an IP number which consists of 4 values divided by dots.
So for example: 220.127.116.11
These values can range from 0 to 255. So it could for example also be 255.255.255.255 and anything in between. But none of the individual values can be greater then 255.
This IP is the id of an internet connection. So when I visit a website, my computer introduces me to the website as being a certain IP number. Based on this IP I am either allowed on that website or refused access.
Most (if not all) websites log (store) access information including IP numbers. This can for example be useful when looking at the number of visitors on a website. Based on the IP and the logs of a website we can see if somebody is for example a first time visitor or a returning visitor. With this info we can also determine if a user is viewing only one page of a website or more which allows us to calculate a bounce rate (percentage of visitors leaving your site after seeing only 1 page) and the average number of pages viewed by visitors.
I already mentioned returning visitor information. A potential problem that could bias your statistics (slightly or massively depending on your website’s popularity) is your own IP. Especially in times when you are working on your website, you will visit your own website quite frequently. So when calculating your website’s statistics make sure you exclude your own IP from your calculations. Most tracking applications will provide the option to filter your visitors information.
Google Analytics is an example of a site tracking application that logs this IP information and performs loads of calculation based on this data. If you want to get insights into your websites popularity I would suggest using Google Analytics because of its extensive possibilities and its price (it’s completely free).