Search engines such as Google use backlinks as a ‘vote of approval’ from one website to another, whether or not this has a positive, negative or neutral effect on the website’s rankings depends on a few factors. The main factor being the reputation of the link source website.
Firstly, there are a two link-types, DoFollow and No-Follow. Gaining a backlink from a source that provides a do-follow link allows for ‘Link Equity’ to be transferred. Link equity is the term used to describe the flow of authority/trust to a website. Optimal backlinks transfer relevant link equity, with Google expecting relevant websites to link to one another, IE A dental website would naturally link to a hospital website.
On the other hand, NoFollow links don’t allow the passing of link equity. Instead, no-follow links are used to signal to Google that you do not wish to pass authority on to the website (Affiliate websites tend to use no-follow link attribute due to the high level of outbound links needed to direct readers to external websites featuring the products)
Webmasters (Website Owners) realize that backlinks are extremely important in helping them gain a page 1 position for targeted terms within Google. Search engines take into account the vocabulary of each page on a website, assuming that it is good enough to be indexed. Alongside this, Internal and External Anchor Text is used to accurately rank the specific page for certain keyword terms.
External Anchor text is the highlighted text that offers a clickable link to a website, the words used within this text can influence the way Google positions the page in its rankings when certain searches are made.
Typically, webmasters tried to use this to their advantage, going after high volume search phrases [located in Google Keyword Planner] and gaining backlinks from hundreds of websites to gain their “well deserved” rankings.
However, Google got smart!
In 2011/2012, after the release of Penguin and Panda, this technique no longer worked. Instead, Google’s algorithm updates enabled them to accurate access the anchor text profile (percentile value of each linked phrase) and the link velocity (the timeframe to which these links were added) of each page on a website, identifying the website’s that were exploiting these unnatural, black-hat techniques. The algorithm updates not only found these pages but penalized the websites using them.
Google has since released several algorithm updates and new algorithms such as Hummingbird.
The lesson to be learned is that to gain valuable backlinks, that help increase your rankings, they need to be gained from reputable sources. Without over-optimizing, the anchor texts used (keep keyword anchor text to less than 4%) or the amount added over time.
I try to keep this in mind when thinking about backlink velocity, how many visitors are the page get? (This can be found in Google Analytics) The reason for this is, that it would be highly unlikely that a website gaining 100 views per month would acquire 200 backlinks per month, naturally. Unnatural signs of backlinks can easily trigger an automated penalty, so this is something to keep in mind.
Well, I hope this has been insightful for you.