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Why are paid links bad?
Unfortunately, when it comes to paid links and SEO, Google doesn't really like paid links at all. In fact, they even have an online form for you to report paid links on a website! But aren't paid links what define online advertising? So is advertising wrong too?
The basic reasoning for treating paid links as a bit of a bad practice in SEO is because it can be seen as trying to cheat the way that Google works. The more links that you have coming to your site, the more 'points' you get, the more trustworthy and relevant you become.
If you have paid for the links coming to your website, you are effectively paying for your website to do better in search engines - and because Google strives to maintain the natural quality of their search engine, this can go against their intentions of delivering naturally relevant results and cause your site to be penalised.
The 'work-around'
At some point, most websites will want to advertise in some way - so there must be a work-around for this? Well thankfully, there are a couple.
When you want to advertise on your site or have affiliate / partner links and whether or not you're getting paid for those links - they will stand out to Google. What Google likes for you to do is basically admit that these links are there, taking away the value that they carry as links. There are a couple of ways to do this.
Start off by using the following code in all of the links:
<a rel="nofollow" href="somewhere">
As long as this nofollow part is in the HTML of the link somewhere, this will nullify the links value because you are telling Google not to follow where this link is going. In this way, neither you or your partners are benefitting from the full (search engine) value of the links - you only get the visiting traffic that the links provide.
Make it obvious
Matt Cutts explains how making these links as clear as possible will go in your favour. As long as you have some sort of indication (such as a standard, text heading) for your links in question, then this will help Google to futher understand what these links are there for and not penalise you.
So in summary - Google doesn't encourage paid links. However, as long as you make it painfully obvious what these links are, then you don't run the risk of looking like a "spammer" instead!
