When a Attack or Special Attack scores more stars on the roll than the defender, a Wound counter is placed on the target.  Abilities with Massive Damage place two counters instead of one.  When wounds are placed, advance the Power Gauge and if the Heros are responsible the Loot-O-Meter

It is also possible for conditions like Fire or abilities like Backlash to place wound counters on models, in most cases the Power Gauge does not advance.