Google’s Matt Cutts has responded to a Google Groups discussion on the Google -60 penalty, which sometimes can set a site back in Google 60 placements due to bad linking, saying that such questionable tactics like paid links in various templates can indeed negatively influence a site’s rankings, especially when those links are identified and Google takes away that juice, which could be seen as a penalty.
Note : Matt did not single out the -60 penalty, but the discussion is centered around various Google penalties associated with bad linking.
ShyBoy, have you been collecting backlinks in any unusual ways? It looks like you may have, and I would pay special attention to that. For example, if you had been attempting to get PageRank via paid links on various templates, then when that PageRank stops flowing (e.g. if Google improves its detection in various ways), the fact that you have less PageRank can also mean that a site won’t rank as well.
If that applies to you, my advice would be to pay special attention to that issue, in addition to the other good advice you’ve already gotten.
For this specific example the site being penalized bought a sponsorship link on a blog template which is being used for various styles of porno spam blogs.
Sometimes sponsoring a template which is relevant to your industry or only used by bloggers you trust makes sense, but when you sponsor a link on a template and then throw it out there for anyone to use, and that anyone is spamming sites, blogs, Google and whoever else they can with porn content and a template attributed back to you … that is not good and seriously, you may even deserve a penalty.
One question is, are all minus X penalties associated with bad linking? Barry at Search Engine Roundtable has a poll (with a funny yet fitting wallpaper) on this running. Please take the time to lend your opinion.
If you’ve been hit with such a penalty (or have had your value taken away from such links), look at the linking you’ve done which is irrelevant, spam related or obviously counter productive to building the authority of your website, delete these links, then redeem yourself to Google with a reconsideration request.