What does "This Steam account already owns the product" mean?

This message means the game in your key is already in your Steam library. Your key is not consumed — Steam does not burn the key when showing this message. The key can still be activated on a different Steam account that doesn't own the game. To find the game on your account, check your library, check hidden games (View → Hidden Games), or visit store.steampowered.com/account/licenses/ for your full activation history.