If the algorithm determines that your website is providing low quality content, then Google will assign your entire website a lower quality score which will make it increasingly difficult for you to rank in the search engine. The rank modifier can severely impact rankings and can lead to massive traffic losses.
This is why Google Panda is a site-wide penalty that affects the rankings for all your organic keywords. If you are penalised by Panda, you'll notice that:
- You are experiencing a sharp, yet gradual traffic decline that eventually stabilizes.
- Your pages have difficulty ranking no matter how many back links you have.
- You can still rank for certain keywords, albeit not as well as before. Your site might be found on page 2 or 3 for many terms.
- Historically, after certain Google updates, your rankings drop further. (Google is constantly increasing it's quality standards which means that if their algorithm dislikes your site, it is likely to become worse over time)
- Google Panda will NOT show up under manual actions in the webmaster tools.
Source: Pierre Far's G+ Account
Panda Related Decline in Traffic
Panda Traffic Decline Stabilizes
The main element to remember for Panda is it is a site-wide quality algorithm which affects all keywords and all of your traffic. This means that if all your keywords have dropped by a certain percentage (verify this by looking at your Google Analytic traffic), then you might be affected by the Panda algorithm.
Currently, the most effective recovery method is Panda Breakthrough which takes the same information and presents it in a different way to both the users and the search engines so that they deem it to be of higher value. When the information is presented in an optimal way, search engines assign higher quality scores to the pages which ultimately leads to recovery. The higher quality score is partly due to the improved user experience which entails better user metrics by the visitors. This can lead to longer dwell times on the site which returns favourable search metrics.