I only attended a couple panels at SES, but Greg Boser was on one of them, and he always has a way of saying things in a clear way. He mentioned in the past that a divide and conquer technique was a great way for small sites to compete with larger rivals. He then went on to say that with Google's current reliance on site age and link related authority that it may no longer make sense to use a divide and conquer method to rank well in Google. If you look through Google's search results for competitive insurance related phrases typically they are dominated by old sites, government and education sites, news sites, and/or sites which are focused on all 50 states. In the past it might have made sense to make sites for each of the most important states, but with the current Google one site with an authority rank of 8 is probably going to be worth far more than a half dozen sites in the same vertical that only have an authority rank of 6 (there is no AuthorityRank meter...just assume it is some arbitrary value based on age and link equity).
Another thing which Greg mentioned in his speech was that it seems Google is really moving away from trusting anchor text as much as they used to. I recently bought an old domain from a friend that was just wasting away. It was old and had a few average type links from related websites, but had no relevant anchor text for the terms I wanted to rank.
I changed the internal link structure to focus the home page on a moderately competitive term. Just doing that ranked it in the top 20 for that term. I then got it a couple low-to-average-quality links with the plural version of that anchor text and got it ranked in the top 10 for both versions. In the past that site might have required either higher quality links or many more descriptive link anchors to rank.
In the past (say a year or two ago) I was way more focused on getting specific anchor text from external sources and probably went a bit far with it. Now it seems all you need are a few relevant decent quality descriptive links and your site will rank so long as your site has a bit of age and a few legitimate links.
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