Maybe it's a misconception based on SEOs telling clients they need to rank highly in Google for certain keywords. So if you're talking about keywords, that means you're trying to rank for several one-word search terms, right? Wrong.
It's hard to believe, but a number of site owners still make this mistake. Or maybe it's not so hard to believe, as new people come into this business all the time. You set up a website selling all kinds of widgets, and you want to corner the market, so you work as hard as you can to get to the top of Google for the keyword “widget.” Maybe you also want to get to the top for “widgets,” because you figure some people will want to buy more than one.
If you do that, you're going to run into all sorts of trouble. I hardly know where to begin, but let's start with the search engine itself. Presumably you're trying to rank in Google or Bing (or both). On their default settings, whenever someone does a search, the first page shows the top ten matches, the second page the next ten, and so on. Many searchers don't go past the first page; most searchers don't look past the first three pages. That means you need to beat the top 30 pages that are already ranking for “widgets.”
This is not easy. If you're new to the widgets business – and I'm assuming your website is brand new, at any rate – you're competing against widget sellers and manufacturers who've been at it for years, maybe even decades. They have older, larger websites with tons of content, all of it optimized for “widgets.” That's a lot of momentum you need to overcome.
Actually, it's even worse than that. Those top 30 pages already beat tons of other pages to the top of Google, so you're also going to have to beat all of the pages that THEY beat. Don't believe me? Just pop the word “golf” into Google and see how many pages are competing for that single word. Do you really want to compete with nearly one and a half billion web pages?
You might be able to pull it off if your company is Maytag and you're trying to land the term “washer.” If you managed it in that case, though, it would be because Maytag boasts one heck of a reputation – to say nothing of the kind of money and other resources it takes to compete for a one-word keyword. For most of us, it's way too expensive. There's no good reason to put in that kind of investment in a one-word keyword...especially when you can get a much better return on your investment with a different approach.
You see, the dirty little secret of one-word keywords is that they don't actually perform as well as you might think they do, given the amount of competition for them. If you think about it, this stands to reason. If you're trying to be seen for the keyword “widgets,” you're hoping to attract people searching for all kinds of widgets: blue widgets, red widgets, cheap widgets, premium widgets, deluxe widgets, electronic widgets, solar-powered widgets, OSHA-compliant widgets, free widgets, sexy widgets, widgets with attached doohickeys...the list goes on. And you probably only supply a few of those kinds of widgets, so you may get lots of traffic, but the vast majority will look, see that you don't sell the kind of widget they're looking for, and leave.
Also, if you're trying to rank for the keyword “widget” because you sell them, you're going to attract people who aren't interested in buying any widgets at all. Sure, there's the group that's looking for free widgets, but there are others. What about the folks who don't know what widgets are, and just want to find out? Or the people with broken widgets who want to get them repaired? Or the ones who have found some vintage widgets in Grandma's attic and want to know what they're worth?
SEOs and smart site owners try to rank for three- and four-word key phrases. Savvy searchers tend to use longer key phrases because they want something that's precisely relevant to their needs; someone who wants to get their widget fixed will search for “widget repair” and probably include their geographical location in the search box. They won't search for “new widgets” or even “used widgets” unless they're looking for a higher limit on how much to spend on repairing their widget. So longer key phrases often indicate a searcher's intent, and SEOs take advantage of this by trying to rank for phrases used by searchers whose intentions are in line with what their sites can offer. For this reason, longer key phrases often outperform single-word keywords, even though single-word keywords might attract more traffic.
To sum up, single-word keywords are incredibly difficult and expensive to win, attract too broad a range of traffic, and as a consequence do not convert well. If you're thinking about ranking for single-word keywords, you need to step back and reconsider what your website is all about. Work on the specifics. What do you want people to do when they get to your website? What do you have to offer them? Once you've figured out the specific kind of widget (or widget service) you provide, put that right up front so you'll attract the widget hunters who want what you have. Use several words, even if it's something like “affordable luxury vintage widgets” (just look at all the pre-owned Lexus and Mercedes dealers!). You'll find your market, and reap the benefits without the struggle you would have had if you'd been trying to rank for just “widgets.” Good luck!
Choosing Keywords 
