ACoS Calculator for Amazon Ads

ACoS stands for advertising cost of sales. It's Amazon's main efficiency number for its own ads: your ad spend divided by the sales Amazon credits to those ads, shown as a percent. An ACoS of 25% means every dollar of ad sales cost 25 cents in ads.

ROAS, return on ad spend, is the same division turned over: ad sales divided by ad spend. A 25% ACoS is a ROAS of 4. Amazon's console shows both, and the what is ACoS guide explains where each one comes from.

"Ad sales" means the sales Amazon attributes to a click on your ad within its attribution window. It isn't all your sales, and it isn't the sales your ads caused. That difference matters more than any ACoS target.

ACoS              = ad spend ÷ ad sales
ROAS              = ad sales ÷ ad spend  (= 1 ÷ ACoS)
TACoS             = ad spend ÷ total Amazon sales
ad cost per order = ad spend ÷ ad orders
break-even ACoS   = margin before ads
profit after ads  = ad sales × margin − ad spend

1. Pull spend, sales and orders for the same dates from Amazon Ads campaign manager.
2. Pull total Amazon sales for those dates from Seller Central's Business Reports, if you want TACoS.
3. Work out your margin before ads: price minus product cost and Amazon's fees, divided by price. The break-even ROAS calculator does it from unit costs.
4. Divide, and compare ACoS with that margin.

A made-up month of Sponsored Products for one product. These are the calculator's example values.

1. ACoS = $1,200 ÷ $4,800 = 25%. ROAS = 4.00.
2. Ad cost per order = $1,200 ÷ 160 = $7.50.
3. TACoS = $1,200 ÷ $16,000 = 7.5%, because most of the month's sales weren't credited to ads.
4. The product keeps 35% of its price before ads, so break-even ACoS is 35%. Profit after ads = $4,800 × 35% − $1,200 = $480.

An ACoS of 25% against a break-even of 35% leaves 10% of each credited sale as profit. On these numbers the ads pay for themselves, as long as the credited sales are real.

There's no universal number. A good ACoS is one below your break-even ACoS, and your break-even is your margin before ads. A product that keeps 40% of its price can run a 30% ACoS at a profit; one that keeps 20% loses money at the same ACoS.

• Well below break-even: the credited sales are profitable, and you may have room to bid higher for more volume.
• Near break-even: the ads roughly pay for themselves. Fine for a launch, thin for a mature product.
• Above break-even: each credited sale loses money after the ads. That can still make sense if it builds ranking or repeat buyers, but it should be a decision, not an accident.

For a target with profit built in, subtract the margin you want to keep from your break-even ACoS. The Amazon profit calculator shows what that means for the whole month.

• Comparing ACoS with a rule of thumb. Another seller's target says nothing about your margin. Compare with your own break-even.
• Mixing up ACoS and TACoS. ACoS divides by credited ad sales, TACoS by all sales. The TACoS calculator covers blended TACoS across Meta and your own site.
• Judging fresh data. Amazon can keep adding sales to a day for a while after the click, so the last few days often look worse than they'll end up.
• Leaving fees out of the margin. Price minus product cost isn't your margin. The referral and FBA fees come out first.
• Treating credited sales as caused sales. Branded search ads often get credit for buyers who were already looking for you.

ACoS divides spend by sales Amazon credits to ads. Some of those buyers would have bought anyway, so a low ACoS can flatter a campaign. Other sales the ads helped cause never get credited at all, especially when Meta ads send shoppers who search for you later.

The only way to know what ads cause is to compare sales with and without them. Size that test with the holdout test calculator, and read the result with the incremental ROAS calculator.