Black should never have played 5... Bg6, but I can understand how that move might get played in a game... since it looks so natural. But it's clearly just about the worst square to retreat that piece. According to Houdini, it's about the 6th best choice, after Bg4, Be6, Nh6, Bc8, or Bd7.
And again, even 7...Bh7 is not good. After just these two small inaccuracies, White's edge is already substantial... about +1.92 or so. (21 ply)
And yes, 10... Nd7 as you pointed out is a complete blunder. White now has a won game after 11.Nxf7.
The best way to counter it? There reall is no "best way"... it depends upon your style and personal preference.
A lot of players like to attempt to cramp Black, and after 1.e4 c6 2.d4 d5 play 3.e5.
I know a couple of players who prefer a wide-open game and play the Panov Botvinnik attack. 1.e4 c6 2.d4 d5 3.exd cxd 4.c4.
Ideally, filter your database (I assume you have a database of a few million master games... doesn't everyone?) to list just the White wins against the Caro-Kann. Then, start exploring and viewing some of the different ways to play against it, two of which I described above, to get a feel for them. You'll probably find something that interests you, and then you can filter your sub-database again, and pull up just these openings, and explore further.
What do you think is the best way to counter the Caro-Kann? My favorite way to play against it is the Two Knights Attack. It has a lot of nice traps that are easy to fall for and it gives you a good lead in development.