"The Long Tail" is a phrase that has come quite popular in the past year. In a nutshell it means that the overall popularity of the less popular entities combined is far greater than the popularity of any single blockbuster. The concept is mostly an issue for content distribution. In the past with traditional distribution channels your content needed to be broadly popular, a blockbuster, if you will. Now with digital distribution channels your content can more effectively focus on and serve a specific niche because you have a method of efficient delivery for that niche.
So how does this apply to SEO? Actually it applies almost directly and in fact this concept I first read about back in 1999 or 2000 in a newsletter, long before the term "long tail" was coined. You see, the main goal of SEO is not actually to rank well in search engines. The main goal is to provide traffic to your site through organic search results. It may seem like these two things are the same, but they aren't, not always anyways.
If you target the long tail of your search keywords, all the less popular less competitive keywords, you can achieve equal or greater traffic than if you just focused on the single most popular keyword. The reason is that while all those obscure keywords aren't that popular, there are lots of them.
To effectively target so many different key phrases you will need many different pages of content, the more the better. This content deluge is what I call brute force SEO. By providing a large amount of content you're bound to rank well on some phrases and the more content you add, the more rankings you will have, the more traffic you will receive.
Of course, there is no reason why you cannot target the popular keyword with your homepage, and all the less popular keywords with your subpages. However, the concept I wish for you to take away from this section is that you do not always need to optimize your homepage. If you feel the main keywords are too competitive there is nothing wrong with focusing on subpage optimization and going after the long tail.