What is a good ACOS?

How can I evaluate the current performance of campaigns. What is a good target ACOS for me?

It is not possible to say in general terms what a good ACOS is, since this always depends on the strategy and cost structure of the products. We recommend running campaigns with a Break-Even ACOS, as this maximizes revenues and makes the advertising self-sustaining.

How to calculate a Break-Even ACOS?

Deduct a percentage of all the cost of your product from its selling price. This includes also taxes, Amazon fees and shipping costs.

Break-Even ACoS_EN-1

The percentage that remains is your Break-Even ACOS and your profit margin. Since each product has a different margin, each Break-Even ACOS is different.

With a break-even ACOS of 21% - as in our example shown - you would make a profit on advertising if the ACOS was below 21%. Values above 21% mean losses from your advertising.

To calculate the actual ACOS of an advertising campaign, you have to divide your advertising costs by the revenues you generated with advertising:

Bildschirmfoto 2023-07-17 um 15.03.26

Read our blog article to learn more about the importance of the advertising cost of sale for your PPC ads.

 

Tip: If you have connected the Selling Partner API, you can enter the production costs in Product Management and we will automatically calculate the profit (click on the profit amount for a detailed view of the calculation). Afterwards, you can also select one of the three dynamic ACOS strategies that adapt to changing prices:

  1. Break-Even: Profit in %
  2. Profitable: 0.75 times the profit in %
  3. Promote: 2 times the profit in %

For example, if the break-even ACOS is 30%, we use 22.5% as target ACOS if Profitable is selected and 60% as target ACOS if Promote is selected.