A "head term" is essentially the opposite of a long-tail keyword.  For instance if you find a long-tail keyword that gets 100-500 searches per month and isn't too difficult to rank for ... say that keyword is "homes for sale in vancouver bc" ... the head term in this case is "homes for sale" which would be getting a lot more search volume but would also be extremely more difficult to rank for because everyone is trying to rank for it.  In this case, if you're a national brand, both keywords are useful to you so you can create a page optimized for "homes for sale" (the head term) and optimize it for both this term and the long-tail.

Flimsy example, I'm sorry, but my mind is blanking and this is the best I can give you! haha.  Also just noticed this post is over a month old but I'm gonna post this anyway in case it helps anyone.  Cheers.