I run a couple of paid links here on Designparc that are industry and category specific. And since I don’t want Google to kick my ass over passing PageRank, I added “nofollow” tags to all of those paid links. A few companies who wanted to place paid links on Designparc got pissed off when I mentioned that I adhere to a strict “nofollow” policy.

Excerpt: Some SEOs and webmasters engage in the practice of buying and selling links that pass PageRank, disregarding the quality of the links, the sources, and the long-term impact it will have on their sites. Buying or selling links that pass PageRank is in violation of Google’s Webmaster Guidelines.

Google’s policy on paid links

Google and most other search engines use links to determine reputation. A site’s ranking in Google search results is partly based on analysis of those sites that link to it. Link-based analysis is an extremely useful way of measuring a site’s value, and has greatly improved the quality of web search. Both the quantity and, more importantly, the quality of links count towards this rating.

However, some SEOs and webmasters engage in the practice of buying and selling links that pass PageRank, disregarding the quality of the links, the sources, and the long-term impact it will have on their sites. Buying or selling links that pass PageRank is in violation of Google’s Webmaster Guidelines and can negatively impact a site’s ranking in search results.

Not all paid links violate our guidelines. Buying and selling links is a normal part of the economy of the web when done for advertising purposes, and not for manipulation of search results. Links purchased for advertising should be designated as such. This can be done in several ways, such as:

  • Adding a rel=nofollow attribute to the <a> tag
  • Redirecting the links to an intermediate page that is blocked from search engines with a robots.txt file

Google works hard to ensure that it fully discounts links intended to manipulate search engine results, such as excessive link exchanges and purchased links that pass PageRank.

Source: Google’s paid links policy

Google’s policy on rel=nofollow tag

“Nofollow” provides a way for webmasters to tell search engines “Don’t follow links on this page” or “Don’t follow this specific link.”

Originally, the nofollow attribute appeared in the page-level meta tag, and instructed search engines not to follow (i.e., crawl) any outgoing links on the page. For example:

 <meta name="robots" content="nofollow" />

Before nofollow was used on individual links, preventing robots from following individual links on a page required a great deal of effort (for example, redirecting the link to a URL blocked in robots.txt). That’s why the nofollow attribute value of the rel attribute was created. This gives webmasters more granular control: instead of telling search engines and bots not to follow any links on the page, it lets you easily instruct robots not to crawl a specific link. For example:

 <a href="signin.php" rel="nofollow">sign in</a>

How does Google handle nofollowed links?

In general, we don’t follow them. This means that Google does not transfer PageRank or anchor text across these links. Essentially, using nofollow causes us to drop the target links from our overall graph of the web. However, the target pages may still appear in our index if other sites link to them without using nofollow, or if the URLs are submitted to Google in a Sitemap. Also, it’s important to note that other search engines may handle nofollow in slightly different ways.

What are Google’s policies and some specific examples of nofollow usage?

Here are some cases in which you might want to consider using nofollow:

  • Untrusted content: If you can’t or don’t want to vouch for the content of pages you link to from your site — for example, untrusted user comments or guestbook entries — you should nofollow those links. This can discourage spammers from targeting your site, and will help keep your site from inadvertently passing PageRank to bad neighborhoods on the web. In particular, comment spammers may decide not to target a specific content management system or blog service if they can see that untrusted links in that service are nofollowed. If you want to recognize and reward trustworthy contributors, you could decide to automatically or manually remove the nofollow attribute on links posted by members or users who have consistently made high-quality contributions over time.
  • Paid links: A site’s ranking in Google search results is partly based on analysis of those sites that link to it. In order to prevent paid links from influencing search results and negatively impacting users, we urge webmasters use nofollow on such links. Search engine guidelines require machine-readable disclosure of paid links in the same way that consumers online and offline appreciate disclosure of paid relationships (for example, a full-page newspaper ad may be headed by the word “Advertisement”). More information on Google’s stance on paid links.
  • Crawl prioritization: Search engine robots can’t sign in or register as a member on your forum, so there’s no reason to invite Googlebot to follow “register here” or “sign in” links. Using nofollow on these links enables Googlebot to crawl other pages you’d prefer to see in Google’s index. However, a solid information architecture — intuitive navigation, user- and search-engine-friendly URLs, and so on — is likely to be a far more productive use of resources than focusing on crawl prioritization via nofollowed links.

Source: Google’s nofollow policy