Unlike a backlink, which is an actual link to your website, a citation occurs when your business name or address is mentioned on another web page. For example, an online business directory that has your business and contact information listed, but has no link to your website, would be considered a citation. Other sources of citations include documents, pamphlets, or other such information from the local chamber of commerce, a newspaper or magazine article, or local business association page.
When it comes to Google and Bing, citations are a major component in their ranking algorithm. Businesses with a greater number of citations will rank higher than those with a lesser amount. These businesses may possibly even rank higher than a business that has fewer links, or none at all.
The source of the citation directly impacts its value. A citation on a well-indexed and established directory like Yellow Pages is likely to convince Google of its authority or authenticity over a lesser known and less popular directory.
"Citations are especially valuable in less competitive online niches like specific construction services," said a marketing spokesperson for Crystal Kitchen + Bath Remodelers. "Many of these services are provided by local businesses that may or may not have an online presence. If these businesses are without websites, search engines like Google have little to go on beside valuable citations from credible sources."
Citations validate a businesses’ presence within a community. A business that is not involved with a chamber of commerce, the city, local paper, or other facets of the community is not likely to be cited by such valuable sources. This can drastically influence a company's local SEO efforts.