Link Building: Link building is the process of generating and maintaining relevant inbound links to a website. This drives targeted traffic to a website and helps it rank higher with major search engines.
Link building isn't necessarily about the quantity of inbound links a site draws. It's also about the quality of the sources or domains where the links appear.
Many unethical SEO companies use below-the-board methods to build links, like posting spam responses on blog posts and web forums with links to their client's site. They may also create "spam directories" and creating websites to be used only to link to other sites.
Search engines have become much more sophisticated over the years, largely to combat "black hat" SEO tactics like unethical link building. If a website is found using these practices, it may be penalized and it's ranking in search engines can plummet.
Generating relevant, permanent links on established sites is a much better way to enhance your presence online and bring traffic to your website. If your content is well written and useful, you may even generate links when other companies link to your site on their own.
There's no single way to go about a successful link building campaign, and it usually doesn't happen overnight. It works best as one component of a comprehensive SEO campaign.