Sub-domains are websites that are located within a directory of your main site and have their own domain name. Because they use the same resources as the main website, they are normally much cheaper than getting another hosting account. The low cost and flexibility of sub-domains offer virtually unlimited traffic-generating potential that won't break the bank. With a little creativity, you can dramatically improve your search engine ranking, bring in more visitors, and expose your site to entirely new markets.
Sub-domains as Portal Sites
One of the best uses of sub-domains is portal websites. Portal websites are sites that link to your main website and have a similar theme. Basically, they provide another portal, or doorway, for visitors and search engines to get to your main website.
Since creating content for a website takes time, often webmasters simply modify the existing text of the main site and reuse it on the portal site. It is important that the content is not exactly the same and the portals do not just redirect to the main site. Otherwise, search engines may not index them.
More Portals, More Visitors
Portal websites can be submitted to the search engines just like your main site. If your website is doing alright in the search engines, then imagine having five more websites out there for the spiders to find. Five more listings means that Web surfers have five times as many ways to find your network of websites.
Search Engines and Links
More and more search engine algorithms take into consideration the number and ranking of sites that link to you. By linking your sub-domains to your main site and to each other, the ranking of all of your sites is improved.
Banner Exchange Programs
Banner exchange programs allow members to share advertising space on each other's websites. They are a great way to generate traffic to your website, but you may not want to clutter your main site with ads. Portal websites provide a good place to test different programs and direct the resulting traffic to your main site.
Alternative Markets
Search engine spiders will pick up on content variations among your websites. Subtle differences could place a site in a category that you had not thought of and open up an entirely new base of visitors and/or customers.
Product and Service Specialization
Your main website may have dozens of different products and services. This is great for your business, but generality can hurt your ranking in the search engines. Using sub-domains to create sites that specialize in one product or service increases your keyword density and improves your ranking. Plus, many consumers would prefer to work with a specialized business than a one-stop shop. (You can still link to your main site with all of your products.)
Source:
Jumpline.com Web Hosting
http://jumpline.com