Your question is “how does link building impact Search Engine Rankings?” Well, Let’s discuss.
Links are important for the search engines as they allow them for two purposes: First, to discover new web pages; second, to help a Search Engine determine how well a page would rank in their results.
Search Engines have code snippets called Web-crawlers. These things crawl pages on the web extract the content-related information from the pages and add them to the index. In this way, a page’s quality could be determined and it could be decided by the Search Engine on how to rank that page with the help of certain algorithms.
While doing this, Search Engines also look at the number of links pointing to that page from external websites and the quality of those external websites.
When a website gets a decent amount of references from external websites then it is more likely to rank well in search results for keywords. Only, getting a certain amount of external website links to our website would not be enough.
Those external websites should contain good quality content, must be relevant with respect to the content on our website.
These websites should also be trustworthy, having a good reputation or authority in their respective field. And when such websites point to our website, its reputation, authority and credibility also increase.
The number of links pointing to a website can also be seen as a vote of confidence about a webpage, i.e. if the page wasn’t so trusted, it would not get many links. Links also imply that, if a page is being linked, then it is considered a good resource. Otherwise, such linking would not be easy to justify as one would not recommend unfriendly tourist places to a friend.
On search engines like Google, links were used as a ranking factor. It was a starting point for Google to dominate the Search Engine market in the late 1990s. Google used an algorithm called the PageRank which measured the quality of pages partly on the basis of a number of links pointing to them. This then was used for the overall ranking algorithm and helped determine the quality of a page.
But, human genius can find a way around almost all things. People invented or discovered different techniques to manipulate PageRank and search results for chosen keywords. Different SEO (Search Engine Optimisation) practices, which were deceptive, shady, manipulative, or black-hat, were used to manipulate search results.
Due to this, even pages with irrelevant content or poor content started to appear at higher ranks in SERPs (Search engine results pages).
Soon, the search engines also started to discover ways through which they were being manipulated and tried to fix it; some of the ways to manipulate links such as link-buying, posting spam-links, link-exchange, etc were used. They started to bring out new algorithms and updates which aimed to find out undeserving or irrelevant websites which were not fit enough to rank or have high precedence in ranking.
So, now Google and other search engines use various algorithms such as Google Penguin, Google Panda, etc to present relevant and informative searches to its users. Not only the searched keywords but the intent behind those words are being understood by search engines now.
Similarly, Search Engines have not become smarter and can find out if the backlinks to a page are relevant or not, whether they have been exchanged, or if some fishy tactics were deployed to get links to a website or a page.
Keeping in mind all the checks used by Search Engines to discourage dishonest link-building techniques, it becomes important to “earn links”.
Instead of using techniques like link exchange or link-buying which are manipulative, websites try to earn links by their ‘virtues’ such as quality and authentic content, great user interface, relevant and updated material, references to other credible and genuine websites which are considered reputable in their domain, etc.
But this process of earning links is a difficult and time-consuming process. As the organic page traffic and popularity grow and the user’s trust increases, other websites refer to our website or pages.
A referring link from an authoritative website, for instance, a popular newspaper website, is harder to get. But getting a link from a website that is considered credible and authoritative in its field creates a greater impact on our website’s ranking than a link from a small or new website.
There are simple link-building strategies that can help “earn” natural and organic links. Some of these are: Creating compelling, high-quality unique content which other people would love to refer to; reviews and mention of products or services of one’s website in front of influencers in the industry, such as bloggers or social media celebrities who have a large following; relevant links from friends and partners whose work is related to the industry or niche of our website. Then, there are internal link-building techniques that can be explored.
Whatever the link-building techniques, they must not be overdone. These techniques should be used optimally. Any overuse of link-building techniques may be seen as manipulation and it may incur a penalty from Search Engine, thus resulting in lower rankings in SERPs.