A common mistake made by those exploring SEO options is to attempt to corner the entire market. Exploit your niche and it will require less of your time, and yet result in higher conversions. For example:
One client I have sells $30,000 custom handcrafted bird cages. I already have him ranked on page 1 of Google, Yahoo, and MSN for terms like Custom Bird Cages, Custom Bird Cages, Custom Parrot Cages, Handcrafted Bird Cages, etc… These terms have low search volume, yet they are well targeted for the type of niche he has cornered. The client also wants to rank for the phrase Bird Cages. Though I'm currently working to get him ranked (I have him up to page 3 now) it is a term that I would not recommend, this is why:
The phrase "bird cages" represents a large market while something like "handcrafted bird cages" represents his specific niche. Those searching for "bird cages" using Google have not identified what type of bird cages they are looking for, the result is that they will get a list of lots of sites that cover all types of bird cages and the search engine user will more than likely need to refine their search.
Ignoring competitive intelligence for the sake of this article, the phrase "bird cages" with a total page count of 2.6 million is far more competitive than a phrase like "handcrafted bird cages" with a page count of 81 thousand. Working with lower competing words, I was able to achieve page 1 representation on Google for 10 niche phrases relating to custom made bird cages within 2 months, meanwhile, 6 months later, I'm still working to rank "bird cages" on page 1 of Google.