When the Google Penguin update was first launched, everyone was seeing it as another update developed to penalize websites, just the way the Panda Update did: lowering SERP (Search Engine Results Page Rankings). Well, it has proven that the Penguin update isn't really penalizing websites, as the direct ranking is not affected.
However, before we talk on what the Penguin Update does to a website, let's first see what was and is the target of this update. As Matt Cutts, the spokesman of Google said the point of the Penguin algorithm update is to diminish over-optimization. Yes, as we can tell from his declaration, Google is still devoted to the idea of delivering the highest quality content to the reader, and also providing him with the best user experience.
So, Penguin is targeting over-optimization. From this point the following question rise: How do we know when it is too much? It is important for a SEO marketer to realize to which point he can increase his website's visibility in the search engines results, but without interfering with the user experience, lowering it. The first example of over-optimization is regarding the links, to be more concise, the backlink structure of a website. Many SEO experts faulted when they used in their back linking strategy a process called keyword stuffing. Keyword stuffing means placing the main keywords of a website as the anchor text for a backlink. This technique can induce in error the visitor, making him to click links and not finding the information he wanted, but also this will create problems when reading content, if the backlink is situated inside an article.
Should SEO marketers be afraid of the penguin update? The answer is yes, as long as in their backlink building strategies are using such techniques as anchor text keyword stuffing. In order to preserve your site from losing some vital backlinks, it is important to make them look like links, and not words from the text. Some experienced SEO experts suggest that we should use generic terms when creating the anchor text of a link, making the reader understand exactly what website he is heading for. As an example, you can use the domain name of that certain website, or, if the link is placed inside an article (advertorial), you should explain the user using the context, where is he heading towards and what will he find there.
As long as you follow those safe techniques, there is no point in being afraid of the Penguin Update, or any other update that Google will release to its algorithm.
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