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An SEO built a copy of my company's e-commerce site on another domain that contained our product's keywords in the name (i.e. as if Levi's built a duplicate site on bluejeans.com)...and then they referenced a lot of the images on the actual website from the other domain (as if Levis.com had images on it referenced like: img src="http://www.bluejeans.com/jeans-front.jpg"), but when you tried to reach the site by typing the name into the browser you would be redirected to the regular website, so the site wasn't really used for any purpose except I guess SEO.

Since I didn't think this was doing anything GOOD for us at the time, I deleted the duplicate site and let the hosting on it expire, only to watch our search engine position rankings fall dramatically.

Any ideas as to what was going on there? I want to get it back to understand its impact, but I don't know how it was set up. I contacted our host and they have no idea how it was set up. I suspect there was some sort of redirect in play, or something?

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If you were doing a redirect from the pages on the second site, and they had incoming links, those links were being credited to your main site. By deleting the second site, and the redirects it contained, you essentially removed any links pointing to your main site (via redirect). Fortunately you can still salvage this if you can re-register the old domain name. You don't actually need the second site to exist to reclaim those links as the redirect can be set up without it. But if someone else picked up the domain there's nothing else you can do but attempt to buy it back at a premium.

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OK well that's good news because we still own that old domain. If you think we don't need to rebuild the second site and get those redirects going again, what should we use to redirect? I'm new to this game, as you can tell. –  dans Nov 30 '12 at 1:23
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In order to get the search bots index the copy-site, it must have allowed the bots to index it. In order to immediately redirect human visitors it must have distinguished between those, possibly by means of Cloaking.

If this was the case it was a wise decision to remove that practice. But anyhow, it is not easy to tell cause and effekt for now and a "dramatically" fall in rankings only because of one site with almost duplicate content and some links, hm...

How is your overall backlink structure (take a first look at opensiteexplorer.org). Did the SEO implement other things you don't know of and now you're punished by a recent Google update?

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I suspected that perhaps some form of cloaking was going on...hence why we ditched the SEO a while back. Backlinks are in decent shape, we actually saw an improvement during the last few Google updates as our competitors were getting penalized. The drop in our rankings happened almost immediately after we let the hosting account on this second site expire. –  dans Nov 30 '12 at 16:32
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