Anchor text is the text attached to a link that points to your site and can be described as a statement or text you click on a webpage, which takes you to another page or website. So it is a link to another site or page. Anchor text is considered very important by all the major search engines. Google, Yahoo, MSN and others place a lot of weight on not just links but also on what exactly is made-up of the actual link.

Many times people attach links to such words as “click here” or “homepage”. Unfortunately, according to Google’s search algorithm or ranking formula, you are now getting credit for the term “click here” and not “widgets online” or whatever keyword or phrase you are optimizing for. When link building, it is very important to fully understand what keywords you are trying to optimize for and include them in the links you build. When issuing press releases, news articles, and blog entries, make sure you are including anchor text with all links pointing to your site. This will not only give your visitors useful information about the content of the page you’re linking to but also it helps your website to achieve higher ranks in all search engines.

One important part of SEO is anchor text – which means the text that is linked. For instance, if you hyperlink the text “home page” then home page is the anchor text. Usually people think of back links when the term anchor text is used, but anchor text is also important for internal linking.

As with incoming links, you should try to include important keywords with internal links, where possible & appropriate. Additional use the title tag to vary your keywords.

Why links are so important? Quantity of links pointing towards your site decides the future of your internet business. While building links you should pay attention not only on quantity but also on quantity of links. Quality links serve two purposes for your website. They not only build credibility of your site but also generate targeted traffic to your website.

Of course, you first need to resear approriate keywords for your site. There are plenty of tools which can accomplish that for you online or offline like wordtracker or goodkeywords. It is very important to have a keyword or phrase related to your site’s theme or your niche.

Afterwards compile a list of often-searched names related to your site’s niche. Pick the phrases with several thousand searches and use in the anchor text of the inbound links that you build for your site. It takes three things to rank well for a set of keywords in Google and other SE’s:
* The keywords you want to rank for in your title tag.
* The keywords you want to rank for in the page body.
* The keywords you want to rank for in the anchor text of lots and lots of links
pointing to your web site – but not all anchor texts should be the same.

Keep in mind: Your title tag shouldn’t be just keywords. After all the title is for humans, so it should be catchy.