We recruit users in your target demographic segment to help organize your site content into logical categories that you can use to build your site's navigation. They help identify the proper terminology for your site's navigation labels, and they tell you where they would look for content of different types on your site.
Benefits
Useful when building the navigation on a new site
Provides insight into users' understanding of terminology and their content needs
Limitations
Exploratory: results may differ significantly across users
Solely focused on category groupings and labels; final design should be tested for understanding of the graphics, layout, etc.