How to research and select keywords in a planned manner?

[Rahul]

I want to create a niche website and i am stuck at this keyword research part and i am really confused about this part. Please provide me with guidelines for how to do keyword research in a poper planned manner, so that i make sure that i dont skip any important part.
Will be really thankful

[Jake]

To get found on search engines it helps to target popular search phrases related to your site's subject, including these phrases in your content helps get search ranking. (A significant percentage of search traffic may come from "long tail" multiple word search phrases that may not appear again.)

There are some tools that give keyword density reports for individual pages, that are used more as guides during the content production process. Keyword stuffing is becoming a less effective, dangerous strategy, just incorporate them naturally in your content.

To get an actual keyword ranking report:

1) Enter the topics of the site into the Google Keyword Tool (a search will turn it up) you will be shown a list of 100 related real world searches, and their search volume [exact match option is the most realistic, some studies have shown that the #1 search result might see 34% of the search volume shown, check-mark all those keywords that make sense, use columns setting to hide all but the words and export the list that you should reference when creating new content and checking ranking.
https://adwords.google.com/select/KeywordToolExternal

2) Use either the free rankchecker for firefox http://www.link-assistant.com/rank-tracker/ to generate a search ranking report for the list of keywords, the latter has some other analysis functions.

This resulting report tells you how people would be finding the site. Those results near the top ten should be focused on, an SEO campaign including additional content, backlinks and keyword anchor text may move that search result to page one where 90% of search results are clicked.