Overstock offered discounts in exchange for links, and now it is paying the price with a Google penalization.

Overstock.com's web pages ranked near the top of results in recent weeks, only to plummet on Tuesday. The company offers marketers a model of SEO “don'ts” with a recent .edu link scheme that resulted in Google penalization.

The Wall Street Journal reports that Overstock was in the top results for broad queries, including “vacuum cleaners” and “laptop computers,” but then it suddenly dropped to the fifth and sixth pages for common queries. The news source reports that Overstock's decline in search rankings is due to its solicitation of links from colleges and universities, as some say Google's algorithm considers .edu links more authoritative than links from commercial sites.

Apparently, the company offered universities discounts in exchange for adding links to Overstock pages. For a 10 percent discount, colleges were asked to embed links to Overstock product pages for campus-friendly keywords, such as “bunk beds,” explains the Journal.

Buying links is bad form, as Google wants to provide relevant results – and this is a lesson Overstock is learning the hard way. “We understand Google's position and have made the appropriate changes to remain within Google's guidelines,” Patrick Byrne, Overstock's chief executive, said.

For its part, Google is remaining fairly quiet. A representative told the Journal that “attempts to game Google's ranking go on 24 hours a day, every single day.” Indeed, just last week, Google penalized J. C. Penney for abundant links from spammy sites.

So what can marketers do to earn merit-based links that will sustainably help their Google rankings? According to the Google's Webmaster Central blog, marketers should “create unique and compelling content on your site and the web in general.”

Katherine Griwert is Brafton's Marketing Director. She's practiced content marketing, SEO and social marketing for over five years, and her enthusiasm for new media has even deeper roots. Katherine holds a degree in American Studies from Boston College, and her writing is featured in a number of web publications.