Backlinks are simply clickable links or clickable address urls from one website to another.
Websites with more quality backlinks will rank higher with the search engines for a given search term.
The results of an internet search for any given term, words or phrases are displayed in what has been determined to be the most relevant Website to that particular search in the number one spot at the top of the list on the first page. The rest of the Websites that are found are displayed in what are considered to be a descending order of relevance.
A higher rank on search engines will almost certainly result in more traffic. The more traffic a website receives the higher it will rank.
The search engine weighs the amount of traffic or visitors a website receives, or has received recently, as well as the number of backlinks that the website has. The more backlinks and traffic a website receives means to the search engine, that the site is important and very relevant to the word, words, phrase or question being searched for.
A website needs to have as many, if not more backlinks, and backlinks of a higher quality than any websites that it competes directly with for a given search term or key word.
Search engines weigh the quality of backlinks as much as they weigh the quantity. To a search engine a high-quality backlink comes from a website that it trusts with a high PR “page rank” and that is also very relevant or closely related to the site which it links to.
Simply put, a backlink is a vote. One website is voting for, or recommending another website to it’s visitors, and in so doing a website is staking it’s own reputation on that recommendation.
The more votes or recommendations a website receives the more relevant that website is considered to be.
Some website promoters will often try to employ different techniques to manipulate the ranking of the website that they are promoting.
To prevent or at least minimize this kind of manipulation the search engines continually change and update their algorithms, the way in which they decide which website is the most relevant to a given search term. They are looking for natural high quality backlinks and are constantly looking for patterns or signs that might suggest some kind of manipulation.
Page rank is determined simply by the amount of visitors that a website receives. A backlink coming from a trusted website in the same, or very similar category with a very high page rank will be considered far more relevant than the backlinks coming from very low ranked, low quality, unrelated or what the search engines might even consider to be undesirable websites.
Search engines never encourage people to pay for links to their website but paid links are a little bit of a grey area because, a paid advertisement on a website for another website is exactly what it is “an advertisement” but to the search engine if this advertisement is clickable it will also show up as a backlink. The search engine’s filter will decide if it’s to be counted or not.
The Yahoo directory carries a lot of weight with search engines because even though Yahoo does charge a fee to have a website listed in their directory, they are very discerning and quite expensive. Search engines consider a link from the Yahoo directory to be a very relevant high quality backlink.
The DMOZ directory does not charge a fee for inclusion but is also a very discerning directory and it is very difficult, and takes a long time to get a website listed on DMOZ. Because of this the DMOZ directory also carries a lot of weight with the search engines.
Websites with high quality content that many people find interesting or useful will, over time, almost certainly, automatically receive many natural back links.
Natural backlinks are of course are what really count.