The answer is quite easy:
Before you get to optimizing your website and promoting it on the Web, you should first select relevant search terms that will reach your target audience.
In other words, you are supposed to pinpoint your Keyword Niche. It should be large enough to draw good visitor traffic, yet 'narrow' and specific enough to let you overplay your competitors and get to the top on the SEs.
This task can be achieved with the help of the Keyword Suggestion tool that will help you:
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Spy on your competition to get suggestions on the keywords related to your business, and build a list of the keywords you might be using for optimization (Explore niche tab);
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Narrow the keyword list by removing the terms that are not searched often enough or turn to be too much competitive (Get suggestions tab);
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Get an idea of your potential keyword niche by studying your rivals that compete for your keywords at different SEs, both major SEs and local ones (View competitors tab);
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Analyze your competition thoroughly to weight your chances of being top-ranked for the chosen keywords/phrases (Analyze competition tab).
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