ACoS, advertising cost of sales, is ad spend divided by attributed sales. A 30% ACoS means you paid 30 cents in ads for every euro of sales those ads produced. Whether that is good depends entirely on your margin, which is why we start every account with a break-even calculation instead of a benchmark.
1. Know your break-even ACoS per ASIN
Break-even ACoS = (price − cost of goods − Amazon fees) ÷ price. A product that sells for 29.99 € with 7.50 € COGS and 9.20 € fees has a 44% break-even ACoS. Anything below that is profit on the paid sale itself; organic halo comes on top. Set targets per ASIN, not one number for the whole account. Launch products can run above break-even on purpose; mature products should sit well under it.
2. Separate discovery from profit
Auto and broad campaigns exist to find search terms. Exact campaigns exist to make money on the terms you already know convert. When both run in the same campaign with the same budget, the discovery traffic drags the ACoS of your best keywords up and you cannot tell which is which. Split them. Move converting search terms from auto to exact weekly and negate them in the auto campaign.
3. Bid to margin, not to position
Top of search is not always worth the multiplier. Pull the placement report and compare conversion rate and ACoS per placement. Often product pages convert nearly as well at a fraction of the cost. Set placement multipliers from that data and revisit monthly.
4. Negate at the right level
Negative exact for terms that spend without converting after enough clicks (we use roughly 10× the product's average clicks per order). Negative phrase only for terms that are clearly off-intent, otherwise you cut discovery too early. Review search term reports weekly in the first 90 days, then every two weeks.
5. Fix the listing before you fix the bids
If conversion rate is below category average, no bid strategy saves you. Lower conversion means more clicks per sale means higher ACoS. Main image, price position, review count and the first two bullets are where most of the gap sits. A +30% conversion lift cuts ACoS by roughly 23% at the same bids.
6. Dayparting and budget pacing
Most accounts spend their daily budget by early afternoon and go dark in the evening when conversion is highest. Either raise budgets on campaigns that hit the cap profitably or use dayparting rules to shift spend toward converting hours. Check the hourly report before assuming.
7. Defend brand terms cheaply
Branded search converts at two to three times the rate of generic search. Running branded terms in the same campaign as generic ones makes the campaign look healthy while generic ACoS quietly rises. Put brand terms in their own campaign with conservative bids. You keep the shelf and see the real cost of generic acquisition.
What to expect
Levers 1, 2 and 4 usually cut wasted spend within two to four weeks. Levers 5 and 7 take six to twelve weeks to show up in ACoS because conversion and rank move slowly. If your account does none of the above today, a 20 to 35% ACoS reduction at flat sales is a realistic first-quarter target.
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