Matt Cutts, Google SEO guru, announced last week that Google will be rolling out an update that will affect exact match keywords in low ranked domains. What this means is means in normal terms is a site will no longer appear to get favorable rankings simply for having the keyword in the domain URL.
For example, if I sell pink hula hoops, and create a website with the URL www.pinkhulahoops.com that would be an exact match domain. With these new changes my site will not automatically get a bump in rankings for pink hula hoops because my domain is an exact match for the keyword.
This is something that we have found to be extremely frustrating from an SEO standpoint. The reason being, is that sites that don’t provide a great user experience and appear to rank extremely well simply because they have the keyword in their domain URL.
Many of our clients have asked if they should they go out and buy domains around all the keywords they want to rank for and build sites around them. Our answer is always no. It is always better to build one site and create a great user experience and you will be rewarded in organic rankings. It appears as though Google has realized the error and those who took this route will be penalized and have to start address their site issues to gain the rankings back.