Many people already know that using subdomains for geo specific locations in the URL have a benefit from the SE's most notably Google, however I have been tracking several very competitive city+hotels such as "london hotels" "new york hotels" etc and it seems this subdomain technique is not only helping, it seems that there is a site of the cityname.domain.com variety on the first page of every kw I have checked. This phenomenon has intrigued be so much I have set up tests such as Search Engine Optimization and others to see how much of a benefit I can acrue from such techniques. Previously I had only gone as far as creating a subdirectory domain.com/keyword/file.html and although much debate was had as to subdomain vs subdirectory I have a hunch that the subdomain is winning the fight.
Stay tuned!
