Two sellers each spend 10,000 € a month on Amazon ads with a 25% ACoS. Seller A has 40,000 € in ad-attributed sales and 60,000 € in total sales. Seller B has 40,000 € in ad-attributed sales and 200,000 € in total sales. Same ACoS, very different businesses. The difference is TACoS.
Definitions
- ACoS = ad spend ÷ ad-attributed sales. Seller A and B: 25%.
- TACoS (total advertising cost of sales) = ad spend ÷ total sales (organic + paid). Seller A: 16.7%. Seller B: 5%.
ACoS measures the efficiency of the ads in isolation. TACoS measures how dependent the whole business is on paid traffic.
What each number is good for
Use ACoS for day-to-day campaign decisions. Which keyword to raise, which to negate, which placement multiplier to cut. ACoS per campaign, keyword and placement is the operating metric.
Use TACoS for strategy. A falling TACoS at stable or rising ad spend means organic sales are growing faster than paid: your advertising is building rank and brand equity. A rising TACoS at flat total sales means you are buying the same sales you used to get for free. That is the number to put in front of the owner every month.
Healthy ranges
There is no universal benchmark, but patterns hold across the accounts we manage:
| Phase | TACoS | What it means |
|---|---|---|
| Launch (first 90 days) | 20–40% | Expected. You are buying rank. |
| Growth | 10–20% | Paid and organic grow together. |
| Mature | 5–12% | Advertising defends and expands; organic carries. |
| Warning | TACoS rising while total sales flat | Paid is cannibalising organic. Check listing, price, reviews. |
Why ACoS alone misleads
A campaign can show a beautiful 12% ACoS on branded keywords while the brand's TACoS climbs because generic rank is slipping. Or ACoS can look terrible at 60% during a launch while TACoS tells you organic sales doubled in six weeks. Managing to ACoS alone makes you cut the launch too early and over-invest in brand defence.
How we report it
Every monthly report we send has three lines on top: ad spend, ACoS by campaign type, and TACoS trend over twelve months. The ACoS section is for us. The TACoS line is for you.
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