In a nutshell, link building is the term used for defining the process of getting links to your website (also known as inbound links or Backlinks from other websites. Links are almost seen as votes for increasing the popularity and ranking of a website.
There is more to SEO than links, however it is thought that a large amount of search engines’ algorithms are based around link-based factors.
What makes a valuable link?
The more links a site has connecting to it, the more that site matters. For example, a website like Wikipedia has thousands of varied sites linking to it, which makes Wikipedia a popular and important site in terms of ranking. This shows that in order to earn trust from search engines, a site needs some assistance from link partners.
If the right keywords are used in links pointing to the page, the probability is that this will have a good effect on the page ranking well in search engines when the targeted phrase in the anchor text is used.
It is presumed that links from sites within a topic-specific community are more effective than links from general or off-topic sites. For example, if a business sells cat beds, then earning a link from the Society of Cat Breeding matters more than earning a link from an off-topic site like a gardening website.
Trustworthy pages only tend to link with other trustworthy pages, it’s rare to find a spammy site linked to a trusted site. When search engines look at the totality of these links in aggregate, they can work out which ‘link neighbourhood’ your website exists in. Links from good neighbourhoods will rank higher, therefore it is wise to carefully choose which sites you earn links from.
It is thought that the internet is around 60% spam, which is why search engines have procedures in place to measure how trustworthy a site is. A link from highly trusted domains like Universities and government websites could significantly boost this scoring metric.
Search engines also have procedures in place to measure how fresh signal links are as they can decay over time. A site that was once popular can eventually go stale and stop earning new links. This is why it is important to maintain the amount of links to your website as search engines judge current popularity and relevance.