One of our customers is a small (2 man) company who sell popular and competitive products (which shall remain nameless coz I don't want anyone snooping at what we did :))
They sell from a 'real world' shop and also through their web site. They are now doing 75% of their business thru the web site and are very happy at their return on investment.
Their site has 200 (static) catalog pages, most of which are getting a top 10 position on Google, and similar elsewhere.
We didn't use any tricks, just clean optimisation coupled with a structured and themed web site. The single most important factor was having a customer that listened to our advice (all gleaned from this forum) and was prepared to trust that we really did know what we were doing.
And that is a bl**dy rare thing indeed :)
We make money from a number of services including optimisation, 2000/IIS hosting, web design and web database applications. The combination gives us enough to keep trading, hopefully as our hosting business matures things will become a little easier.