The graph below is from the SEOptimise blog showing what happened to a new site after building 10,000 spammy links to it in a single day. What happened was the site tanked in rankings just after a few weeks.
I took a new domain that I wasn’t too worried about destroying, picked a reasonably competitive keyword, and built about 10,000 really nasty-looking low quality links in to the home page with a mixture of phrase and exact match anchor text.
The site ended up ranking #1 on Google.com for this keyword for about three weeks, which as you can see had a significant impact on increasing the site’s traffic.
New data shows the site is now back in the top 10, after taking a dive in rankings.
This case study is continually building upon itself in the comments. There are just so many factors, it is hard to isolate the issue or issues. The site is new. It has 10,000 horrible links. The links are all spammy, 99% of them. The site is now ranking well again. The site may be based in the UK.
Here are some good comments from the post:
After reading your latest comment, my opinion is that the penalty was triggered by the fact that the spammy links accounted for 100% of the external inbound links of the target website (which had none beforehand). If you repeated this test on an established website with non-zero link popularity, I believe you would not get the same results. Hurting a competitor may be possible, but it’s certainly not that easy.
This is likely a failure of Google’s QDF algorithm. They want fresh, viral news to appear in the SERPs as it comes, but it’s also perhaps very possible that they can’t efficiently determine what to trust and what not to trust at certain points because of the push/pull effect trying to display “fresh” news creates in their search results.
Anyway, if anything, it is always fun to watch people destroy things.
Forum discussion at Sphinn.