Google webmaster guidelines > Submission guidelines > Guideline one of five in this category states...
"Have other relevant sites link to yours."
Definitions-
relevant - having a bearing on or connection with the subject.
Examples and Explanations
This guideline tells us the importance of links to the the Google ranking of your site.
It has long been established that linking is the basis of the Google system of knowing "how important" a page is. What is widely misunderstood however is the importance of quality. Many people have bought, connived, or created their own links in an attempt to fulfill this guideline.
What is a good link? What is a bad link?
- The perfect link is a link that brings you traffic that is interested in your site (relevant).
- The ideal link is not one you create. It is one that brings you traffic that some else has created because they think your site is useful.
- A less ideal, but still useful link is one that is listed in a reputable directory . This is because reputable directories organize websites into subjects and only include sites relevant to that subject.
- A bad link is a link that brings no visitors.
- The only thing that is worse than a link that brings you no traffic is a link that you created through manipulation that does not bring you traffic.
Is having 100 bad links better than having 1 good link?
- No.
- It is better to have one good link (a link bringing you traffic) than 100 hundred bad links (links that bring no traffic).
Why is everybody buying and manipulating so many links if that is true?
- Because it used to create higher rankings in Google, and in some ways still does.
Why shouldn't I buy or manipulate more links if it helps my rankings in Google?
- If you are creating a website for your business or one that you want to last a long time and be reputable you should not seek links that are designed to make you look better to search engines. You should seek links that bring you actual traffic.
- The link manipulation that used to increase ranking is less effective than it once was. Google has stated that link manipulation will have even less value to their ranking of websites in the future.
- It is against the Google webmaster guidelines.
- Google is not the only source of visitors to websites.
If you have 1000000 links that do not bring you traffic and Google stops ranking your website well, you will have less traffic than the website that has only 1 link that is bringing them traffic.
Key concepts
Have other relevant sites link to yours
Resources
From Google:
Google webmaster central blog article about building links:
Building link based popularity
From Google employees:
Matt Cutts on getting links
Link baiting
From other sources:
GetListed.org
Free tool displays how you are listed in local search engines
Link Value
Traffic as a link value indicator
Advice on link building:
9 steps to getting good links
Good link analogy about link value:
Link value