Little known Search Engine Snap.com has been around for almost 6 months. It has a very interesting business model. It’s based on conversion and transparency.

First, Snap has introduced a Cost-Per-Action advertising model. An advertiser only pays when a user does a specific action. This can be a purchase, or a form submission, or something else that’s meaningful to the advertiser. The higher the conversion, the better placement an advertiser gets. Makes sense, most advertisers measure this anyways and Google offers a tool to track conversion so why not base your model on it? The search results are determined by the conversion rate. The rational is that the higher the conversion, the more relevant the website. Very similar to the Overture approach what worked well for searches for products and services.

Secondly, Snap is very transparent in all this. The search results show the user how much an advertiser pays and what their conversion is. So a user can see how valuable their business is to the advertiser, and therefore, how relevant. I haven’t seen a conversion rate on any search results I’ve seen but Snap doesn’t get very many searches yet (75,000/day, Google receives millions). Snap is transparent about their whole business model. Click on stats on you can create all kinds of interesting reports including popular keywords, traffic, advertiser specifics and Snaps financials. Very interesting.

And third, Snap has an interesting product search as well. Search for Digital Camera, for example and a special search results show where the user can filter and sort the results. They use similar technology as Google is experimenting where user input immediately results in action without a service call. Jesse James Garrett has coined the term Ajax for it.

I like what Snap is doing. It uses a model a lot of companies use for measuring advertising and transparency users will appreciate. Call Snap crazy, but it’s run by the same people who created Overture, who introduced pay-per-click bidding and sold the company for 1.7 billion to Yahoo. Question is if users will adopt this over the big guns Google, MSN, Yahoo or Ask. Probably not likely. The key will be in syndication their search results. That’s what made Overture a success.