Both are good to improve, tactics and game play/analysis. You can send me a message if you like, I can help you with your openings and game understanding. Take care.
Do tactics REALLY help?

Tactics solving is No. 1 in the list of must do for chess improvement. Time to read a tactics book like Winning Chess Tactics by Seirawan
Q. 2+2=?
A. 4
This is the answer the quiz is asking for in order to give full credit.
However, the answer to that question could also be 5-1, 10-6, -58+62, log 2(16), etc. The point is that there is a multitude of answers (goofy answers) all valid, although only one is the correct, simplified one, which is 4.
Playing the game allows one to see those "goofy answers". Players can checkmate an opponent in three moves, for instance, while the correct - simplified sequence of moves - would have achieved the same checkmate in two moves. So, tactics do differ from the actual game, and this difference does not take away from their usefulness. On the contrary - tactics help players simplify the game. Tactical exercises and actual game play are complimentary, not contradictory.

Thanks everyone for the responses. Thinking about it, tactics MIGHT be improving my game however the real issue is I'm not getting any better at solving tactics so I will take all your points on board.

Hi there
I try and complete the daily 5 tactics a day here and after today's attempts I find my score at 1023, the same score I was last June! So in 8 months my ability to solve problems has remained the same, I haven't improved at all which is most frustrating and shows that I've learned nothing from tactics. Most people say the only way to improve at chess is to do tactics all the time but I disagree.
Personally I think by playing chess games more regularly and studying where you went wrong, trying to avoid blunders etc is of more use if you want to improve.
Chess is all about pattern recognition. Forget about the score, and work on remembering the patterns.

Once you miss 3 tactics then stop!
Concentrate on those 3 you missed and study then until you thouroughly understand them.
Repeat daily...

You need to do more tactics. There are many free resources over the internet. My favourite is the lichess trainer.
This book, along with its many puzzles, gives some general explanation and also shows the most common tactical themes (like pins and forks).
http://www.amazon.com/Winning-Chess-Tactics-Everyman/dp/1857443861
To be honest, I would not expect much improvement from solving 5 random puzzles a day. Correct me if I'm wrong, but some puzzles are simply capturing an undefended piece. This may help your observation, but such puzzles are not tactics at all.
In real games, the most useful habit you can form is looking for forcing sequences of moves. What drives this sort of calculation forward is assuming both players will try their best to not lose any material. Forcing moves are checks, captures, and threats (like attacking an undefended piece).
Forgive me if this is already obvious to you, but some lower rated players say losing a pawn, knight, or bishop is not important to them. To improve though, you have to be greedy with your material. Try not to lose even a single pawn during your games.
If you're greedy, form a habit of calculating forcing moves, and learn the most common tactical themes, then I think you'll see improvement in your games quickly.
Although they're somewhat opposite, I like both Robert_New_Alekhine's and Diakonia's advice.
My advice would be to do about an hour of puzzles a day (however many that ends up being) but at the end of the session you review all your missed puzzles.
Then on the next day you do nothing but review the missed puzzles.
Then a week later you review the puzzles from the first day again.
IMO this is much easier to keep track of if you buy a book of puzzles. When I was working out of a book, I would attempt to solve any puzzle I missed at least 5 times over the course of a year. I didn't really have a schedule or anything, I'd just pick up the book now and then and look for puzzles I'd marked with a "X." If I could solve it really quickly, then I'd mark it with a check mark and ignore it in the future.
Tactics are super important especially at lower levels. Pieces are hung often and spotting these opportunities will win you a lot of games. I've always had a decent tactical eye even as a kid and before joining here I hadn't played chess in 10 years. I've been 1600+ in standard pretty much the entire time. I don't even think I'm that good at chess as a whole but yet I'm 90th percentile or higher in blitz and standard on here and I believe that's mostly because when my opponents hang stuff, I see it and take it lol. All you need to be decent at chess is an understanding of the ideas associated with the openings you play, good tactics and some basic endgame knowledge.
Hi there
I try and complete the daily 5 tactics a day here and after today's attempts I find my score at 1023, the same score I was last June! So in 8 months my ability to solve problems has remained the same, I haven't improved at all which is most frustrating and shows that I've learned nothing from tactics. Most people say the only way to improve at chess is to do tactics all the time but I disagree.
Personally I think by playing chess games more regularly and studying where you went wrong, trying to avoid blunders etc is of more use if you want to improve.
Updated in #41