Across the websphere, I see forums filled with online money making folks declaring the reduction of their traffic by more than 70-90%. The ranking drops experienced by these folks is much worse than what Panda has caused. It is not uncommon to see terms that you are ranking for totally disappeared from the SERPs.
When did the latest Google algorithm changes rolled outIf I am not mistaken, the changes were rolled on 24 April, around 5pm. The effects were rather instant. Once your sites were affected, you can see the effects sinking your sites faster than the titanic.
What kind of sites were affected by this algorithm changesNobody can tell you this now. In fact, nobody can tell exactly what is going on in Google's algorithm. There are too many factors to consider and none of the SEOs have any insider information to have a full understanding.
My own humble opinion is that this algorithm is targeting sites that used manipulative links to control their rankings. I saw a Google patent that states that it has the ability to understand the source of your links and whether these documents have been manipulated or are a part of a larger network whose sole purpose is to give links.
How to recover from this latest Google algorithm changesThe immediate reaction is typically to take some actions in hope that your sites can recover their rankings or to get their traffic back. My advice is to sit this out for a couple of weeks. It is common for Google to roll out their algorithm, see how the SERPs are affected and then rolled back some of the changes if the outcome is not ideal.
More importantly, asked yourself this: is my sites worth saving? I have been changing my thinking these days. When building out lots of niche sites that are neither spam nor high quality, I will always be affected by these changes because I am limited in my ability to draw different traffic sources.
Whether your sites deserves to be recovered is a question you need to ask yourself. Don't have the mentality that the site outranking your site is spam or have lower quality so your site deserves to be at the top. You need to be honest. Does my site deserve to be at the top?
For me, I can tell the difference between aaronchua.com and my minicupake site. As best as I can try to make the mini cupcake site useful, it will never be as personal or relevant as aaronchua.com for the simple fact that I don't have any personal experience with baking or has any interest to learn.
How to build sites that avoid Google penaltiesStart with passion. Create a site that you are passionate about or have a deep interest to find out more then. Then use that passion to find out what the community is missing. Create a site to help them solve the problem.
This is how to build a site that will not suffer under any Google penalties.
Passion sites don't take shortcuts. They need your tender loving care to blossom into something that will give you good income for many years.
The tough part is to figure out what you are passionate about. Believe it or not, most people have no passions, which explained why they are happy to let life passes by.
Treat this latest algorithm changes as a wake up call. Time to build something that is useful and long lasting.