Backlinks have always had some bearing on how well a site ranked in search engine result pages (SERPs). However, in the past, the algorithms were not designed to take into account people trying to cheat the system by loading up on backlinks from sites that had nothing but links on them, no content of any real relevance. These sites quickly became known as “link farms” and were used by webmasters to increase the ranking of their multiple sites.
In addition to this practice, webmasters often created one web page specifically to house reciprocal links called a links page. It was used by people building reciprocal links to better leverage their site in search engine results but provided no real content. Sometimes, reciprocal links were even exchange between sites that had no direct relevance to each other too. So, in a links page you might find a link to a toy site when the website hosting the link had to do with the elderly. It obviously made no sense to reward this type of behind the scenes ranking manipulations!
Google was one of the first major search engines to start looking at how to reward good quality links that had relevance and added content to a site instead of rewarding savvy, but somewhat unscrupulous practices of cheating the search engine results with backroom deals and black hat tricks. They kept using backlinks as a determinant of reputation, but also strengthened the algorithm to look for specific quality links and penalizing link farms and other black hat maneuvers.
A backlink is really very simple. Anytime another website places a URL link on their site that links directly back to your site, its called a backlink.
Why are backlinks important? Because they help bring people to your website, but also because they help boost your sites search engine standing.
All this from just a simple link to your site? Yes! But only if you know the differences between types of backlinks and understand how to get the best mix of types to get the most traffic to your website.
Beware, though, because there are some pros and cons to each kind of backlink, and if you use them incorrectly or in the wrong combination you could end up actually lowering your search engine ranking by mistake.