Exchanges are a way of sharing your own traffic to other websites. Brilliant people who are experiencing the same problem of directing an inadequate number of visitors to their sites had devised this strategy not too long ago. The idea is very simple. All a person has to do is to post advertisements of other websites on their own sites in exchange for the same thing.
In essence, it is you-advertise-on-my-website-and-I'll-advertise-on-your-site sort of agreement. People want to increase the popularity of their sites and that's a given. Some people are more than willing to exchange or share resources with others, so to speak.
There are different things you can propose an exchange with to other websites. You can exchange links, banners, content, and a whole lot of other promotional stuff. It is more about sharing what you have to other web masters so that they can share what they have to you in response.
The most popular exchanges in are in the form of URL's. Some web directories are actually requiring websites to put their link on the front page of the website that is requesting inclusion. More often than not, web directories test their live links to see if it is really there before they accept the website for submission.
Web directories are online classified listings of different websites. The links of the websites they contain actually came from the web masters who had intent to be included in the list. Some web directories are paid directories. This means that you need to pay these sites a certain amount before your link shows up on their pages.
However, web directories understand that not all web masters have the necessary funds to pay for advertisements. As such, web directories devised another mode of payment. Instead of web masters paying them money for link inclusion, they pay by publishing the web directory's link on their front page. This setup benefits both parties. The web directory is getting the promotion it gets while your website is getting more backlinks.
But links are not the only things that are used for exchanges these days. There are also inline text advertisements and even banners. Banner exchanges work in the same way as link exchanges. Only in this type, graphical banners are published instead of mere URL's.
Here, you can catch more of an audience from another website because you are free to use eye-catching graphics and sometimes, even multimedia, to get your message across. Banner exchanges with another website is a good idea if and only if the other website you are trading advertisement spots with have a better page ranking and traffic than you do.
Of course, the other website may be a little choosy in selecting a banner exchange partner. Either your website had to be related to their own, or yours has to have an equal amount of traffic and enjoy the same page ranking as theirs.
There are certain requirements that both parties have to meet. And it is very important that the two web masters exchanging links with each other have open communication so that they both maximize their efforts of generating traffic to their respective sites.
There are several websites nowadays that are proposing exchanges to fellow web masters. They serve as a middleman between two websites that are looking for traffic. In essence, they match two or more websites so that they can pool their resources together to gain the traffic they need. Their service makes the whole system easier, as you don't have to personally talk to another web master for an exchange. Most of them offer their services for free, by the way.
Exchanges can really do wonders for your site. If you have distributed your links or banners to a substantial amount of websites over the internet, even if only one unique person gets to click them everyday, you should be getting the results that you want. However, you have to be very careful when entering deals like these.
You don't want to over populate your websites with somebody else's links, advertisements, and banners in such a way that your own content becomes merely a shadow of the ruckus. Be very wary when positioning the links and banners from exchanges as well. They should not, in any way, make your website lose its credibility.