Generally it means that it is time for a new battery. Some indicators are not too accurate, however. Personally, I would get a new one because I don't like to be stranded with a bad battery. If the car sits around a lot and discharges the battery often, it ruins a battery. Optima sells a yellow battery for this kind of use. They can take being discharged a lot and still manage to be good.
As far as the gauge goes, the battery gauge shows you what the alternator is doing, not the battery condition (that is why batteries have indicators). I guess it is easier to paint a battery symbol next to the dash gauge than an alternator symbol. Or maybe people don't recognize alternator symbols, but they do batteries. In any case, don't trust the dash gauge to tell you how good your battery is. Some shops can do a draw-down test to check your battery. It will put a load on the battery and see how fast the voltage drops. If it drops fast, you need a new battery.
As for the gauge, again, it tells you if your alternator is charging. If it charges too little, the battery will eventually die. If too much, it will boil the water out, wreck the plates and the battery will die. The gauge in the dash is too cheap to tell you the exact voltage, so most mechanics have a "real" guage and can check the alternator output for you. With the car running , the lights on, the wipers on, and the heater and radio turned on, the voltage at the batery should not fall below 12.5 volts. With the car running and all electrical loads turned off, you will get between 13.5 to 14.5 volts. At least that was the figure we used MANY years ago. Things might be slightly different these days.
Personally, I would have the battery changed and the output of the alternator checked. My guess is that the alternator is fine and the battery is starting to get weak from lack of being charged regularly (as indicated from your low mileage.)