Clients and readers often ask why a site that's younger, smaller, or just plain "uglier" outranks them. There really isn't a simple answer. More than a few times I've had to say, "I don't know." But there are some things to take into consideration when a competitor is outranking you. Addressing these issues could be the catalyst for your Web site moving up into those coveted top spots.
Content Is King
No -- I didn't coin that phrase, but the number one reason for getting outranked by a competitor: better, and much more, content on their site. Don't forget your content needs to be original, unique and relevant.
More pages will not necessarily make you rank. We're talking about more text. Do you have an all Flash Web site with little text to feed the search engine bots? It may be a flashy classy slideshow. It may be much more aesthetically pleasing than your competitor's site.
If the search engines, though, can't spider (define) your site to determine how relevant your page is to a particular query, you're not going to rank well for that query. That's not to say you can't use Flash, just wrap some text around it -- or work around the problem.
In travel, my particular niche, many of our clients' competitors are part of a huge chain of Web sites with vast numbers of pages. The pages for hotels in New Orleans aren't relevant to the pages for hotels in New York City, but if all those pages live on the same domain, they lend power to all the pages on the site.
A 10,000 page site is going to have a much easier time ranking for a particular keyword phrase than a 10-page site, particularly if they're using that keyword phrase in their on-site optimization in the correct manner.
Architecture is the Path to Good Rankings
How is your site constructed? Do you have well thought out navigation and easy to understand "paths" through your Web site. Users and search engine spiders use your architecture to learn what your site is about.
The more pages the spiders can reach, the more "credit" you have for having a lot of content related to phrases. Think about the user navigating your site and make sure relevant content is linked together, and irrelevant content is not.