Work on your knowledge. Both in the Citadel and in the knowledge tree/Oracle. Use defensive boosts if you think you may be attacked. Knowledge knowledge knowledge is the key to this game, at least you can never go wrong with it lol. 

The game affords a very wide variety of ways to improve your troops.  The more troops engaged the better; there are seven tiers each stronger than the last; as the last poster indicated knowledge gained in the Oracle helps; improving hero and shaman helps also; as does providing the hero and shaman with equipment; troops can be upgraded in the Valkyries Citadel and summoning Aesir from their Sanctuary gives a boost.  And you can acquire and apply a range of items which confer further boosts.

The cumulative effect of all this is very large.  Green tier 1 troops have one fifth or less the strength of developed tier one troops, a well developed hero doubles and triples the strength of troops when present, high level gear likewise.  Valkyries adds 80% to all tier 1 stats, 190% to tier 4 and still more to higher tiers.  The Tier I to V branch in the Oracle adds 20% to all stats for tier 1, 65% to tier 4 and more to tier 5.  In the Military branch once Demons are unlocked there are six knowledge branches each of which gives a substantial boost.

There is little or no balance in the game between attack and defence, attack is much the stronger.  For example in your fight you, the loser, suffered an automatic 80% casualty rate.  The attackers' losses were determined by the difference bettween your troops stats and the (much more powerful) attacker's.

Can any lessons be drawn from this?  Well one conclusion easily reached is that, unless you are minded to destroy any challenge or interest in the game by simply buying progress with cash you will never be able to fight off any of the much more powerful towns such as the one which attacked you giving rise to your thread.  What you must do about such towns is to learn to employ shields effectively.  Next it is also easy to see that seeking to be able to train higher tier troops before you are able to support them with knowledge and a well developed hero/shaman equipped with high level gear is a mistake.  So give priority to knowledge advances over buildings.  Thirdly it is worth cultivating a fatalistic attitude to an occasional defeat such as you suffered.  The damage done by such a defeat is pretty well trivial.  You lose some troops and some resources but both are easily replaced.  Your buildings, knowledge, hero, shaman, hero/shaman gear etc. etc., all the things you spend time and effort developing are entirely unharmed.  Of course a heavy defeat is not welcome but it is also a minor inconvenience rather than a disaster.

As regards priorities among the various ways to improve your troops it is currently thought that the knowledge/hero/shaman advances which reduce the enemy's stats confer the greater comparitive advantage followed by the various "offence/defence against" advances followed by health, defence and finally offence.  I doubt that it is needful to pay much attention to that however.

If you are a patient sort of person you will find the slow, steady progress along the military path satisfying.  If you are impatient but unwilling to join the ranks of the Vikings: Game of Shopping folk then this might not be the game for you.

Good luck.