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Our site has thousands of items, however using the old "Widgets" analogy we are unsure on how to implement the canonical tag, and if we need to at all. At the moment our main product pages lists all different "widget" products on one page, however the user can visit other sub pages that filter out the different versions of the product. I.e.  glass widgets  (20 products)
glass blue widgets (15 products)
glass red widgets (5 products)
etc.... I.e.  plastic widgets (70 products)
plastic blue widgets (50 products)
plastic red widgets (20 products)
etc.... As the sub pages are repeating products from the main widgets page we added the canonical tag on the sub pages to refer to the main widget page.  The thinking is that Google wont hit us with a penalty for duplicate content. As such the subpages shouldnt rank very well but the main page  should gather any link juice from these subpages? Typically once we  added the canonical tag it was coming up to the penguin update, lost a 20%-30% of our traffic and its difficult not to think it was the canonical tag dropping our subpages from the serps. Im tempted to remove the tag and return to how the site used to be repeating products on subpages.. not in a seo way but to help visitors drill down to what they want quickly. Any comments would be welcome..