Will Top Ranking for Volume Search Terms matter anymore?

We have been watching closely how Google treats a new website we are promoting (www.flagoutpost.com) in regards to the time it takes to get ranking. The other day we had a visitor from Google come in for the single word “flags” from our local search listing. This got me thinking. As Google shifts over time serving more local search results for broader terms, does this spell the demise for going after those top volume single word terms? The more location based search is refined and with mobile search (smart phones) become a key player are the days will be numbered for those top volume broad terms. Of course there will always be plenty of “long tail” search volume, but this does put a new spin on the value of SEO.