Short answer: ACoS is ad spend divided by ad sales. TACoS is ad spend divided by total sales, including organic. ACoS tells you whether ads are efficient; TACoS tells you whether ads are growing the whole business. A good ACoS is one below your break-even point, and a healthy TACoS usually falls over time as organic sales grow.
If you sell on Amazon, these two numbers decide most PPC conversations. They look similar, but they answer different questions, and optimizing for the wrong one is a common way to stall a growing account.
What is ACoS?
ACoS (advertising cost of sale) = ad spend ÷ ad-attributed sales × 100. If you spend $300 on Sponsored Products and those ads drive $1,000 in sales, your ACoS is 30%.
ACoS measures ad efficiency at the campaign, ad group or keyword level. It is the number you use day to day to raise or lower bids.
What is TACoS?
TACoS (total advertising cost of sale) = ad spend ÷ total sales × 100. Using the same $300 of spend, if the product sold $3,000 in total (ads plus organic), TACoS is 10%.
TACoS shows how dependent the business is on advertising. Because Amazon rewards sales velocity with organic rank, good ads should lift organic sales too, which pushes TACoS down.
ACoS vs TACoS at a glance
| Question | ACoS | TACoS |
|---|---|---|
| Formula | Ad spend ÷ ad sales | Ad spend ÷ total sales |
| Measures | Ad efficiency | Ad dependence and organic growth |
| Best used for | Bids, keywords, campaigns | Budget and strategy |
| Healthy trend | At or below break-even | Flat or falling as sales grow |
What is a good ACoS?
There is no universal number. Start from your break-even ACoS, which equals your profit margin before ad spend. If a product makes 35% margin after Amazon fees and cost of goods, any ACoS under 35% is profitable on the ad sale itself.
- Launch phase: ACoS above break-even can be acceptable for a few weeks if it is buying rank on important keywords.
- Growth phase: aim for ACoS near break-even while TACoS falls.
- Profit phase: push ACoS well below break-even on proven keywords.
What is a good TACoS?
Many established brands sit somewhere in single digits to the low teens, but the trend matters more than the number. A rising TACoS with flat total sales means ads are replacing organic sales instead of adding to them.
How we use both numbers
In the accounts we manage, we set ACoS targets per campaign from each product’s margin, then judge the overall plan by TACoS and organic rank. That is how a VersaChalk restructure grew revenue 230% in six months and how a Jamaica Blue Mountain Coffee relaunch kept ACoS under 20% while sales tripled. Read more on our PPC management page.
Frequently asked questions
Is a lower ACoS always better?
No. A very low ACoS can mean you are underspending and missing sales. The right ACoS depends on your margin and whether you are launching, growing or protecting profit.
Where do I find TACoS in Seller Central?
Amazon does not show TACoS in one place. Divide ad spend from Campaign Manager by total sales from Business Reports for the same date range, or use a tool such as Helium 10.
Does ad spend help organic rank on Amazon?
Ad sales count toward sales velocity, which is one of the signals Amazon uses for organic rank. That is why a falling TACoS is a good sign.