There are a couple of reasons why you might want to consider paying for links, even though the cost can run as high as hundreds of dollars per month on some sites. One reason is to boost your site's link popularity. Another is to gain targeted traffic from the sites you're acquiring links from. The key is to be judicious -- it's not just the quantity of links that matters, it's the quality as well.
Some Webmasters who've made big link buys swear that they were subsequently penalized by search engines. If that were strictly true, however, it'd be easy for shady Webmasters to buy links pointed to their competitors' sites as a way of sabotaging them by making them look like spammers. While it seems outrageous that search engines will automatically banish you for buying links, credible evidence does exist that you can run into trouble for buying into the wrong networks ("free for all" link exchanges, for example) or generating too many links too quickly. It's wise to take a measured approach.
Research your purchase -- check the backlinks to the site you're thinking of buying links from. Does it look like a site set up by hand to rank well? If so, realize that links from such sites often prove to be much less beneficial than their purveyors might lead you to believe. Remember, it's easy to get lost in the shuffle when your link appears on a page populated with hundreds of other links. Look at other sites that are currently buying links on that site. Do they appear to be getting the benefit you're looking for? Not all sites pass the link authority test, regardless of their PageRank or perceived authority.
Besides that, where's the benefit to your business if the relevance of sites that link to yours is tenuous or non-existent? Site-wide links to unrelated Web pages are an invitation to your competitors to report you for link spam. From the standpoint of gaining traffic, rather than just trying to pump up your rankings, it makes more sense to buy links within your vertical. The best approach: Before you pay for a link, ask yourself if the link is to a site that might actually bring you traffic, rather than just a boost in search rankings. If so, then it's a good buy.
Another point to consider is the size of the network you're buying into. How fast are you increasing your link numbers? Too many links too fast can be a red flag to search engines that your links are artificially inflated. An important key to link acquisition is to make your growth appear as natural as possible. Don't quadruple your backlinks overnight. Instead, spread your buys out over a period of time. As your link numbers grow, you'll be able to pursue larger networks, since the addition of these networks will now represent a smaller increase to your count than they would have previously.
Your anchor text for the link is the last piece of the puzzle. Avoid links that merely say your company name or "click here." If you sell fuzzy blue widgets, buy links that say "fuzzy blue widgets," "fuzzy widgets," "buy fuzzy blue widgets," and so on. You want to make it easy for the search engine to determine what your link is about once it's found. Link text that agrees with the page it links to is extremely powerful.
Finally, consider this: Is your site optimized? If it isn't, any strategies you adopt to try and trick the search engines will only provide a short-term lift in traffic, at best.
Todd Friesen is director, search engine optimization, Range Online Media. firstname.lastname@example.org