Directories come in many shapes and sizes, some are general, while others are more topical and highly specialized. One of the biggest directories out there is DMOZ but as of lately rumors have been swirling about possible wrong doings by many of their editors.

Webopedia describes a directory as the following: “(1) An organizational unit, or container, used to organize folders and files into a hierarchical structure. Directories contain bookkeeping information about files that are, figuratively speaking, beneath them in the hierarchy. You can think of a directory as a file cabinet that contains folders that contain files. Many graphical user interfaces use the term folder instead of directory.”

Large directories like Yahoo tend to have very generalized themes and many charge small fortunes for listings. While smaller and niche directories like 2ListNow.com and 2SearchTech.com offer free listings. The business models for some of these directories include premium listings, advertising revenue and pay-per-click advertising like Google adsense.

Being listed in a directory can bring in targeted traffic, and also provides a valuable (for SEO purposes), one-way link from a relevant website. Many directories obtain high Google Page rank and strong SERP's and are therefore considered well-respected resources, and are covenanted as link partners.

Some of the smaller niche directories might not supply large amounts of traffic but the traffic they do send is highly specialized and very valuable. Your conversion ratio (if selling a product or a service) can be quite high.

In conclusion, directory listings should be an important part of every Webmaster or website owners game plan for achieving higher SERP's, page rank and quality visitors.