Suburban Chicago small business owner takes on Google over ad practices

CBS News

2 days ago

In what amounts to a David-and-Goliath situation, a suburban small business owner is taking on Google over a beef you've likely seen in some form in the headlines.
He says Google's grip on advertising is costing him millions, and the U.S. government shares his same frustrations.
Bridgeview, Illinois-based Royal Home Flooring posts spiffy videos of its jobs — which sometimes spur a sale. Word-of-mouth referrals do the trick too.
But owner Salah Abukhaled opened up his books to show us most of his customers come through Google.
"I knew if I want to go ahead and succeed in this business, I have to be on the web," Abukhaled said.
To try to be the king of flooring, Abukhaled has given the titan of tech millions of dollars for ads over the past nine years. He pays Google to tie certain keywords like "flooring," as well as users' locations, to his business.
Between April and August 2023, Royal Home Flooring paid Google Ads $257 per click — totaling $693,000. His bill jumped to $958,000 — almost $1 million — during the same five-month stretch the next year.
During that time, if a person's Google search led them to Royal Home Flooring, the entrepreneur was apparently charged $673 for each click.
"Why am I paying this much?" Abukhaled said.
Abukhaled acknowledged he was told his Google bills might be higher after switching to something called Smart Bidding, a different Google Ads marketing strategy that touts it allows users to maximize conversions, or sales.
What is not clear when it comes to Smart Bidding is pricing. We could not find any basic details about cost on any of the Smart Bidding help pages from Google either.
"It's crazy. I swear. I mean, we struggle enough as business owners. The cost of the materials is going up. The labor is going up too, as well," Abukhaled said, "and when your advertising cost is going to go up, who's going to eat it at the end of the day? It's the end consumer."
Customer support chats to understand Abukhaled's skyrocketing monthly bills went nowhere.
"They put you in this infinite, like, loop," he said.
Abukhaled filed a credit card dispute against the Google Ads charges.
"Without question, they just suspended my account immediately," he said.
Even after all that, however, Abukhaled is still using Google — because, he says, there is no other place for him to advertise.
"When you think about it. Google, they own about 95% of the search market," he said.
Abukhaled feels stuck paying whatever Google wants him to pay.
The U.S. Department of Justice has filed not one, but two lawsuits against Google, alleging the company is a monopoly that needs to be broken up. The government won both cases — most recently in April.
A demand letter form Abukhaled can now be added to the tech giant's legal troubles. Royal Home Flooring wants an arbitrator to step in and address what it calls "a breach of good faith and fair dealing, and potentially deceptive conduct."
Abukhaled said when he tells family and friends he is going after Google, "I think they take it as a joke, honestly."
But he is not laughing. Quite seriously, the small business owner said he is ready for a big lift to make a big wave. He said he is confident that he is not alone.
Google's press team said it could not comment because of the ongoing legal dispute. Google also would not answer CBS News Chicago's general questions about ad pricing — we were pointed to written statements the company made a month ago after accusations that it works as a monopoly.
Google denies those allegations.