exchanging links with key competitors

what's ok - what's not a bright idea?

[D_Blackwell]

I've got a site that does quite well with the engines for a wide range of widgets. The biggest weakness that I see right now is that the site has very few inbound links. This latest Google update may have exposed this somewhat. I think it's time to shore up the defenses by getting some good links. The site is a well known and respected leader within its niche. Lots of lesser players would be happy to exchange links, but so far I've put off almost all exchanges.

After going back and forth through the site search here, I haven't seen anything about linking with higher level competitors. We vastly outperform everyone in almost all search strings, including our "top" competitors. But my inbound links are woefully thin. What is the trade off in linking with competitors? How tough or important a competitor should I trade with? What are the risks?

I've specialized in content with great success. I guess I've been spoiled in links not being critical. But now there strategic decisions to be made. If I don't link with competitors, the quality of the link options will drop quite a bit. What to do? What to do?

[vrtlw]

For what it is worth:

I have this week taken the initiative to do just what you are saying, but I have taken the approach of adding their link to my site anyway (even without a confirmed reciprocation).

The way I see it is that if I can demonstrate to my users that my product is the best value for money then they will return to my site and purchase. I have even gone to the extent of scouring the local Yellow Pages and weekly newspapers for URL's. I don't want this to appear as being a sign of desperation, but I believe my site and visitors will benefit from my apparantly impartial linking strategy.

As far as reciprocation goes, I do my best to find a contact email address on the target site and shoot them off a well targeted and personalised email explaining to them that they can now find their link on my site and for a small token payment or reciprocal link I would make sure their listing gets more prominence.

Short term results have been very good, in the long term who knows? I will have to see how things pan out in the next couple of months.