During high-traffic events like Black Friday or Prime Day, it’s common to use strategies that boost your product’s visibility. However, it’s important to remember that advertising success is closely tied to ongoing content optimization efforts—such as improving A+ content, bullet points, titles, and visuals—which drive organic traffic and rankings.
Amazon is a constantly evolving platform that learns from your actions and their results. If you focus solely on keeping your ACoS (Advertising Cost of Sales) low while relying heavily on ads for sales, you’re essentially signaling to Amazon, “My products sell when I advertise.” This approach can be limiting. Since sales come from multiple placements on Amazon, a large portion will be indirectly influenced by advertising. Ignoring these indirect sales means you miss out on fully understanding your brand’s performance.
TACoS stands for Total Advertising Cost of Sales, a metric that looks at your brand’s overall performance by considering total sales, not just those driven directly by ads.
The formula is simple: TACoS = Ad Spend / Total Sales
When launching a new brand or product, experimenting with different ad placements—such as Sponsored Display, Sponsored Brands, and competitor product pages—can generate many indirect sales that may not be directly linked to your campaigns.
Relying too much on advertising can drive up costs, so it’s equally important to focus on increasing organic sales. If you concentrate only on metrics like ACoS and ROAS (Return on Ad Spend), you risk falling into a cycle where high costs force you to cut back on ads, reducing total sales in the process. It’s crucial to accept that ACoS may be higher during product launches or high-traffic periods.
In the long run, by focusing on TACoS, you’ll see improvements in your ACoS as well.
Stronger organic rankings, boosted by indirect advertising, will enhance your listings and ultimately optimize your advertising performance.
Hope you enjoyed this short-form content. All this talk about Tacos made us hungry. Time for some real tacos. Bon appétit!