Also known as search terms or query terms. Keywords are the word(s) and/or phrase(s) a user searches. A Search Engine Results Page (SERP) ranks indexed sites against the relevant terms.
Keywords are a very important part of and search engine optimization programme. Identifying the most important keywords or phrases that prospective clients may use and ensuring a good (top 10) ranking on the major search engines (Google and Bing) is critical to the success and sales of the site.
The type and length of keywords and key phrases that you target are a very important factor for your ranking. The more competitive your keywords are, the more difficult it will be to achieve the highest ranking on the major search engines.
If the top ranking sites for your chosen keyword are very competitive then it's will be difficult to achieve a ranking in the top 10 results with a small site that has only a few pages and even fewer links.
In these instances, the best strategy is to start with very targeted multiple word keyphrases (i.e. long tail terms) and then slowly move to the more competitive keywords (and shorter terms) as you achieve your goals and your content and inbound link count improves.