Directory submission has changed a lot from the 1990s when it was the most popular method to build backlinks to your website and also get visitors. The advent of Google meant that now people did not have to go through directory listings to find out the websites they wanted. This has reduced the importance of directories as far as traffic is concerned. However, directories are still useful if you want to build backlinks to your website.
Top directories on the Internet normally have a Page Rank of 6 and higher, which makes them an eminent source of good link authority. Most of these directories are paid directories. However, just because they are paid does not mean they will include just any site that can pay the fee. They still check the quality of every website submitted to weed out the bad apples. Another interesting aspect of paid directories is that Google has strict rules regarding websites that ask for a fee in return for links. Google's guidelines state that paid links are bad. What is allowed, however, is a review in return for a fee. Therefore, you should make sure that the paid directory you use follows this guideline and actually reviews the websites submitted to it.
Niche directories only contain links to websites that are related to a particular niche. For example, if you are submitting a blog, you can submit it to the following directories: bloglines, BlogCatalog and Alltop. These directories only accept blogs. Similarly, Visual Loop is a directory dedicated only to websites related to info-graphics. Almost every website has related niche directories that give more link authority if a website related to its niche is submitted to it.
When submitting to directories it should be remembered that Google appreciates a single link from a reputed directory more than a hundred links from unknown directories. This is especially true after the latest updates from Google. Google's Penguin update now penalize websites that have spammed their links all over the web. However, you can still submit your site to multiple reputable directories. Remember to modify your site's headline and description for every directory that you submit your site to for variety.
Using directory submissions to build links for SEO can improve your website's SERP rankings. As a general rule of thumb, paid directories should only be used if they follow Google's guidelines because they will be the most effective. Two great options are the Yahoo Directory and the Business.com directory. If you submit to free directories, try to make sure they are related to your niche. Directory submissions are often seen as an old-school method to build backlinks. However, when done right, getting backlinks from reputable directories can be very beneficial for organic website traffic.