How Link Exchange Works
One of the top factors search engines consider to calculate the relevancy of a website to a particular keyword is the number of quality inbound links to that site. When backlinks to your website are coming from another website with similar or related content, these inbound links will be considered as related. Otherwise, the link is considered less relevant, making it a low-quality backlink.
There is a significant difference between relevant backlinks and low-quality backlinks. The higher relevance of inbound links, the higher quality your backlink is. So, if you have low-quality backlinks, lesser is the chance of boosting your website's popularity and visibility among search engines.
When a webpage has a link pointing to your site, some of that sites score is transfer to your site, in this situation both sites benefit. However if the backlink is seen as low quality then your site will not receive any benefit from this backlink, and the site which is linking to you will still have some of its score reduced; as a result neither parties will benefit, and the linking site will have its quality score negatively affected.
Quality over Quantity
As already mentioned, low-quality backlinks will have a neutral or negative result. So to build a quality backlink plan that will last, we need to look at the purpose of backlinks, and why search engines value them highly.
If we consider the reasons for backlinking outside the realm of SEO, you will see that linking your page to another page is simply telling the viewer that there is similar content worth reading via this link. Inserting a link is a way of notifying your audience to another share worth piece of content. And this is also in part how search engines regard backlinks.
If we consider the intent for which search engines created this backlinking factor, we can then build our backlinking strategy with these same values and will not or ever have to worry about penalties or algorithm changes in the future.
Build Your Backlinks With Quality, Relevant And Authoritative Websites
Not only is backlinking seen by search engines as a ranking factor but it also is a way for you to reach out to a new audience. A better way to go about link building is to put your customers first; not search engines. Google will see these links where your customers are finding you and then increase your rank on their search engine in a way that more people of a similar demographic, or interest, can also find you.
Reciprocal linking is a link exchange agreement which one webmaster places a link on their websites that points to other webmasters sites and vice versa. Reciprocal Linking was a widespread practice among SEO consultants but it didn't last because it does not offer a good user experience or add any value to the content, so search engines developed their algorithms to disqualify these backlinks.
Alike many SEO hacks, they quickly get caught up with algorithm changes and result in your site being pushed back or even penalized. These backlinks provided no value and so were discounted; however the outbound links are still counted, this diluted their pagerank score and left many websites with a lot of outbound score and little to nothing inbound. Sites that participated in reciprocal link exchanges resulted in their rank on Google plummeting until they cut outbound expenses.
That said reciprocal linking is not fundamentally bad; it was just being used by many to cheat the system. Reciprocal linking can be a great way to connect with your target audience. Choosing only relevant sites to link with and sites that do not have many outbound links on their pages, and then it can be a sure way to build quality backlinks, rank up on Google, and connect with more customers of a similar demographic.
There are tools that can help you track and acquire quality backlinks. Keeping it simple is also a preferred option, sometimes we all get distracted with fancy and overly complicated tools; often the best option is to be simple and just use a spreadsheet. And remember, get to know your target customers, find sites that they visit and reach out to those site owners.
Google Webmaster Tools
Google webmaster is full of useful tools for webmasters, one of which enables you to see all inbound links that the Google search bot has found which are pointing back to your site. Google webmaster will give you in-depth information about the words used in these links, and where they are located. Webmaster tools also includes internal linking that notifies you of any negative or broken backlinks.
To build quality backlinks is of great importance to search engine marketing, so putting backlinks on your priority list in your SEO efforts can surely pay off.