Chomp: Taking a bite out of Google's AdWords?

Chomp Search Ads is the AdWords for apps

Move over Google -- at least in app advertising. App search engine Chomp launched Tuesday a private beta advertising program that allows developers to bid on keywords or phrases and will deliver the ads to users who search for those keywords or phrases in an app store.

Chomp is already somewhat of a pioneer in the app search industry, with an engine that allows users to search for apps based on what they do, not just what they’re called. For example, with Chomp, a user can search “puzzle games” or “expense trackers” to find apps that fit these topics or functions.

The advertising program, Chomp Search Ads, takes an approach similar to Google’s AdWords by matching app ads to the most relevant potential customer.

“The best time to advertise a product is when a consumer is looking for that type of product and the best way to advertise is with an ad that is relevant to the search,” Chomp CEO Ben Keighran said to me.

Chomp is opening up Chomp Search Ads to a limited amount of advertisers during this first stage of private beta. The company announced that Milk and Zaarly are two of the first companies participating.

“Search Ads is going to help app developers get their app discovered and help users find apps that are most relevant to them,” Keighran said.

Like Google’s AdWords, Chomp Search Ads is an auction-based advertising service where advertisers will first set up an account pre-loaded with ad dollars. Chomp will then recommend search terms based on the developer’s app with the developer having the ability to request terms as well, according to the release. Advertisers can then bid for the rights to a keyword by setting a daily maximum spend as well as a maximum bid price for a given keyword or phrase. They will get charged when users click through via the “Get It” button on the ad.

Chomp will show ads for apps based on a number of factors, such as bid price, as well as relevancy to the search term. Increasing the bid price will help improve the chances of an ad showing but according to the release, “users will always receive the most relevant search results, irrespective of advertising buys.”

With Search Ads, Chomp will also provide reporting to advertisers allowing them to measure the performance of their ads on the engine.

The market Search Ads is tapping into is sizeable. With over 200 million iOS and Android users looking for apps each month, developers are spending 20-30% of total app revenue they generate on trying to acquire new users through various advertising and marketing initiatives. According to Gartner Group, $893 million was spent on app advertising in 2010. By 2014, Gartner expects total app revenue to be $50 billion and as a result, is forecasting a $15-20 billion spend on app advertising.

The release of Chomp Search Ads follows a Sept. 23 announcement of a partnership between Chomp and Verizon. In a post announcing the partnership, Keighran said “beginning this fall, all Verizon Android phones will ship with Chomp’s app search engine.”

Though this seems like it would infringe on Google’s territory, Chomp does not cut out Android Market, rather provides power search for apps within Verizon, which includes Android Marketplace. Its ability to do this is what Keighran said makes Chomp such an innovative and relevant app search engine.

“We are the independent search engine that can work across marketplaces,” Keighran said.

When asked if Verizon had expressed interest in the Ad Search feature, Keighran said that there was no date for when this would go-live with them.

Along with the Verizon partnership, Chomp’s service is also available on iPhone, as well as a number of other devices.