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Honestly, I think this kind of thing happens fairly often. The one paid link Google will never catch is the one that we agree to at the bar at the end of the day at SES/SMX/Pubcon/Mozcon/etc. On a less manipulative level than paid links, the best exchanged links come from relationship-building. If there's a site that's relevant to your site and where a link would benefit the users, reaching out to that site is just good, white-hat link-building, IMO. I guess the problem comes in when you try to systematize it. Practically speaking, you end up with a lot of people looking for low-hanging fruit and submitting junk. Plus, as soon as you build a link network (no matter how good your intentions), you have to market it - once you market it, it's bound to get on Google's radar. I think there are sites that skirt the edge of this, but it's tough. MyBlogGuest is a great example - it's a marketplace for guest bloggers, and often people guest blog for traffic/links. The site is just setting up that exchange and relationship, though - it's not directly driving link purchases or exchanges.

Thanks Nakul - I have been considering circumstances and am simply preparing for if a client comes in post penguin with some major linking issues. Definitely some good ideas here.

So then I wish to know how do I compete with my other websites. Lots of them are not that meaningful still they show up before us. What should we do in order to rank high than our competitors? Adwords? Better content? What exactly

Thanks for the kind words on MyBlogGuest, guys. We fight hard for the quality there trying to turn it into a valuable resource of awesome guest posts!

I agree with Bradkrussell, don't buy links, i own an eCommerce i have ranked #1 for 5 best keywords in that market and suddenly lost for #1 Goggle for that 5 keywords and lost 30% of my visitor, and now my visitor has normal again even when i still lost my ranks. I see your website and i found your website hasn't friendly url for example http://www.perfectindesign.com/index.php?main_page=page&id=30 just try Nakul advice visitor not only comes from head keywords, i lost head keywords rank but now my visitor get normal even better than before, just make your website riched with keywords and done with good optimization, Good luck

Low budget just means you have to put the time in yourself.  Good content takes time to create, and if you can't outsource it, then you're stuck with doing it on your lunch breaks

Ouch.  All the thumbs down aren't really necessary.  Margaret is just sharing what seems to be working for her.  If it works for your niche, then go for it.

Hi Larry, To get a report of all of your competitors backlinks you'll need to use Open Site Explorer (opensiteexplorer.org). Just input the domain that you want links for and you can access all of the data you need. If you want to compare your links with their links I recommend going to the "Linking Domains" tab, selecting "Show domains with links to all pages on this root domain" and then downloading that report. Do the same for your domain and then compare the two reports in Excel. SEOMoz is full of advice on how to get more backlinks. Two places I'd recommend are today's blog post (http://www.seomoz.org/blog/the-noob-guide-to-link-building) and the beginner's guide (http://www.seomoz.org/beginners-guide-to-seo).

sites are moderate popular, the links are keywords links i have other links besides those. around 50 domains link to the sites but the backlinks are 50.000 from the other 47 sites and 100.000 from those 3 sites.

Just give it some time, if you use a 301 from the old url to the new one and report the changes via google webmasters tools it should update fairly quick. Should be no need to fix the links. Edit (Fixing link instead of text): See http://googlewebmastercentral.blogspot.com/2012/04/how-to-move-your-content-to-new.html

On the balance of your answers it sounds like a positive thing. The site is highly reputable and even though on a another c-domain (which is a great thing) is a 'friend' of ours. I guess the quantity of links is safe.

You are very much welcome.

The reason to remove links from domains that are de-indexed from Google listings is because mots of the times domains that are de-indexed are caught as the participant of some low level activity.

Link Building is a creativity game so ideas can be countless… But here are few of the starting steps that I would recommend or may be if I would be at your place, I would have done that. Extract the back link profile and start removing links from the places where possible.. Usually with article submission it’s possible if you have all the credentials of it. Try to avoid article submission or at least don’t use it heavily. Instead of This try guest posting on different blogs, magazines and digital news papers… although making connections for guest blogging and other will be a difficult job in the beginning but fruitful at the end of the day! Infographics that is liked by bloggers and audience as this can give you good links and brading at the same time. Try manual outreach as this is difficult but must do job in link building that people use to avoid. Try some contest in the niche and grab links from press and bloggers in your niche. Think broad and connect different industries with you and get links from those blogs and forums… This can go infinity… but I would recommend reading some link building post that comes from time to time and you can get some great ideas from there!

You might already have this, but http://www.awwwards.com/ is a pretty decent source. If your site is responsive design/HTML5, you could also submit to HTML5 Galleries and if it's an exclusive/custom design on a CMS, you could also submit to that CMS's galleries, eg Wordpress and so on. Just some idea starters, I hope I ignited some ideas in your head

The person who captures the high ground early can hold a long term advantage. Since you are below them, crafting an extremely good title tag and snippet is essential to win clicks away from them.  Offer surprise, mystery, free shipping, kickass price or free beer in your title to win traffic into your site.