Xyo opens its ad program for its contextual mobile app search engine

Xyo is tackling the problem of mobile discovery — finding the right app in a sea of duds on the app stores — with a search engine that makes it easier to find the mobile app that you’re looking for. And today, the company is launching a new app advertising product that lets publishers advertise their app in more than 200 natural points for discovery.

The Contextual App Advertising program is now available as an open beta as an alternative form of advertising. By “contextual,” Xyo means that it can dsiplay advertising where the user cares about it.

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Xyo believes that traditional keyword-based ads aren’t effective for mobile app discovery. Publicly available data on user search patterns shows that most user searches are generic. They search for words like “cool game,” “apps,” and “fun.” Sometimes people search for titles like “Candy Crush Saga.” Since the user doesn’t know what he or she wants, a traditional app search engine won’t be helpful in producing meaningful results.

“That’s a pity, of course. It’s awesome that keywords work that well on the web. You can build fantastic tools like Adwords based on keywords. But I’m afraid you can’t have the same approach in mobile app search,” said Marcin Rudolf, chief technology officer of Xyo.

Online ads have three components: creation, or what the ad looks like; media planning, or where the ads will run; and media buying, or how the ads are paid for. Berlin-based Xyo has been testing its unique approach to media creation and media planning in its closed beta test. If a user is seeking  “block games,” it may show Gameduell’s jewel puzzle game, not because it is an exact match but because the users of jewel puzzle games also search for block games.

With Xyo, the app search engine guesses what a user’s intent is at any given moment, without keywords. The company has collected app data since 2009 and has app-preference models derived from behavioral and social data.

In contrast to older approaches, Xyo’s app search not only anticipates a user’s intent at a given moment, but it actively helps to express it via navigation built for each possible query. This approach allows Xyo to overcome the generic nature of most user behavior.

The company has now deployed the same technology for advertising. Xyo has collected a number of testimonials from industry executives.

“People have been talking about search engine marketing (SEM) for apps for quite some time, but I still haven’t really seen it. I think Xyo has cracked it! It’s a combination of a search interface and a semantic understanding, meaning that it has both the intent and the relevance you need to make it successful,” said Raj Singh, CEO of AI-calendar app Tempo.

“The power of Google Ads comes from the algorithm that places the ads into relevant contexts,” said Gunnar Lott, head of communications at Flaregames. “Xyo employs this strategy for their ad service and shows users interested in one kind of app other apps/games with similar topics or mechanics. This is utterly brilliant and beautifully executed.”

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“This is the first time I’ve seen contextual mobile app advertising done right,” added Deng-Kai Chen, former head of ad operations at Tapjoy.

“Xyo’s automatic catalog construction and interest-clustering of apps are interesting technologies that solve two problems at once. For the consumer, they provide better ways to discover apps. For the advertiser, they provide an algorithmic method for targeting specific interests at a level that is more precise than broad interest or category targeting,” said James Kelm, COO of Wormhole Games.

“The latter could unlock significant value in the app ecosystem,” said A.J. Yaekel, chief operating officer of user acquisition platform Growmobile.

The company is backed by investors including Signia Venture Partners and Flaregames’ CEO Klaas Kersting.

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