It’s been a bad week for J.C. Penney, which found itself penalized by Google and scrutinized by the media after a paid link scheme apparently orchestrated by an outside vendor — now fired — was uncovered and detailed in the New York Times.

Not surprisingly, J.C. Penney isn’t sitting idly by. It’s defending itself.

Its strongest response yet to the controversy it has found itself embroiled in was given to SEO consultant Alan Bleiweiss, who reached out to Darcie Brossart, J.C. Penney’s VP of Corporate Communication.

It’s a response that J.C. Penney may yet regret, as it raises more questions about the retailer’s online marketing strategy.

In an email to Bleiweiss, Brossart wrote:

Our natural search program has never included paid web links, like those described in the article. It is against our policy, and the fact is, we don’t need to them to build our Google rankings. 

We have millions of links from our web partnerships
and programs that already gave us link popularity. These included links from our 1.4m Facebook fans, who clicked from Facebook to; social media and fashion bloggers; our holiday partnerships with Yahoo!, Microsoft, Time Warner, Hearst.  Our links on these sites during the holidays had editorially relevant content and pointed to our product pages. 

These links and ones like them are what drove our relevancy rankings on Google, not the unauthorized, low quality links that the New York Times reported on.

I’ve bolded the important points because they could be seen to contradict the claim that J.C. Penney has never paid for links. “Partnerships” that produced “links on [partner] sites during the holidays…pointed to our product pages” — with “editorially relevant content” no less — may not sound to some people like something that wasn’t paid for.

After all, I can’t imagine companies like Yahoo, Microsoft, Time Warner and Hearst, which are all in the business of selling advertising, would ‘partner‘ with J.C. Penney to write articles linking to its product pages during the most important retail season without some sort of compensation.

As it relates to fashion bloggers, it appears that the company has indeed courted fashion bloggers and vloggers, some of whom are compensated. Smart online marketing strategy? FTC concerns aside, perhaps.

But when you see bloggers associated with groups such as the Style Coalition, “a network of independent online publishers in the fashion and lifestyle vertical” that has “built an alliance of key influencers to help brands, retailers and agencies directly connect with our passionate audiences“, whom J.C. Penney has worked with, publishing blog posts that look like nothing more than advertorials, you may wonder where ‘smart online marketing strategy‘ ends and ‘paid linking‘ begins.

The key point here: apparently not all paid links are created equal. The retailer was busted by Google for a scheme that appeared to rely on a high volume of links on low-quality sites. But it speaks volumes that in its defense, J.C. Penney claims it has never paid for links while citing all the links it has received from ‘high-quality‘ sites!

If anything, this highlights the challenges Google has in detecting and dealing with paid links. The truth of the matter is that Google can’t detect every paid link, and at some level, it probably shouldn’t even try to.

The fact that J.C. Penney apparently can’t determine what’s a ‘paid link‘ by Google’s definition shows that an even bigger part of the challenge is coming up with a workable definition for ‘paid link‘ that doesn’t leave a million shades of gray.

At the end of the day, nobody is really disputing the fact that J.C. Penney probably does have a significant number of highly-relevant pages for product-related searches that one would naturally expect to rank well even without a large number of paid links.

But Google still finds itself facing a huge dilemma here: if a company isn’t permitted to boost its ranks by buying in bulk spammy, low-quality links, why should it be allowed to pay for higher-quality links from ‘legitimate‘ publishers?

I think that’s a question Google is hoping won’t be asked in a highly-visible fashion, and frankly, I can understand why.