Three Reasons to Start Designing Iteratively

The iterative design methodology is, in my opinion, the most effective and powerful approach to designing websites and applications.  This is particularly true when comparing it to the more traditional waterfall methodology.  While the methodology may be old hat to our more mature cousins, industrial designers, it seems many of us in the UX community are only now discovering this technique.  (At the same time, there are aspects of working iteratively when designing digital products that are unique compared to fields such as industrial design.)  So, what is iterative design all about, and what makes it powerful?