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ACoS (Advertising Cost of Sales) is ad spend divided by ad-attributed sales; TACoS (Total ACoS) is ad spend divided by total sales, organic included. ACoS measures campaign efficiency; TACoS measures how dependent your whole business is on ads. Healthy accounts usually watch both - and weight TACoS more as the brand matures.

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The Formulas

  • ACoS = ad spend ÷ ad-attributed sales × 100
  • TACoS = ad spend ÷ total sales (organic + ad-attributed) × 100

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Why the Difference Matters

ACoS can look “bad” while the business is getting healthier: launch-phase spend that drives organic rank raises ACoS today but lowers TACoS over time as organic sales grow. Conversely, a “good” ACoS can hide an unhealthy account if ads are cannibalizing branded searches that would have converted organically anyway.

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Rules of Thumb

  • Launching a product: expect high ACoS; watch TACoS trending down over months as organic rank builds
  • Mature product: a rising TACoS with flat sales means growing ad dependence - investigate organic rank and conversion
  • Profit decisions: compare each ASIN’s ACoS to its break-even ACoS (margin before ads ÷ price) - the Breakeven Calculator computes it per SKU

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The Metric Behind Both

Neither metric matters more than contribution margin - actual profit after all fees, ads, and COGS. That is the number OBG manages accounts to (see Amazon PPC Management) and the lens of the free OBG360 Audit. To see your own true margins, run the Amazon Profit Calculator.