Market analysis is a necessary step for anyone considering SEO. You need to know (1) who the major players in a given industry are (2) what strategies they have at their disposal (3) what percentage of traffic they receive from specific keywords as well as (4) if they have other related keywords rising to the top of search engines in addition to the tip of the iceberg / keywords you can reveal.
Setting out to overtake a competitor that is firmly nested in the SERPs for a specific keyword requires understanding of the elements they used to procure that ranking. Keywords are currency as they ultimately lead to sales conversion.
Aside from time, content, internal links and the other obvious stages of the SEO process, the most important aspect of keyword positioning is research and determining if the effort will be worth it once you reach the Mecca of a given search term.
Aside from the topical ranking a website may exhibit, search engines are known for parsing entire sites to determine the amount of relevance a given website or web page has for a specific keyword or term.
Call it deserve ability, the background check, the on page or off page litmus test or whatever you like, the fact remains the same that if you want to impress the ranking and scoring mechanism they have in place, you need context to provide further insight.
If you overlook this component and jump into a market with both feet and take on the most competitive keyword or competitor, you might discover that the phrases you are targeting are only the a mere glimpse of their entrenchment for all things related as the competition may be more vested that you imagine.
There are many ways to compile data from research, the only rule of thumb that we employ is to utilize more than one source to triangulate the spectrum of results to quantify and validate the discovery of pertinent information.
The SEO video above is a great example of one SEO tactic that you can use with free tools to conduct a stint of competitive market research and analysis to determine keywords worth pursuing.