You're absolutely right. Google introduced what they call "stemming" last fall, and that's what their example shows, but what I'm talking about isn't stemming.
For example, do a search for "autos" in Google. Notice that the #20 result (for me at least) is ajccars.com, even though the word "autos" appears nowhere on that page.
We saw this change on March 28 of this year. Suddenly that day we were showing up in the top 30 for lots of terms that were related to ours, but that weren't actually used in those pages. These were pages that ranked in the top 5 for the terms they were specifically targeted to, but these new terms were only related to those.
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