If you’re selling on Amazon, you’ve likely wondered what the average Amazon Advertising Cost of Sales (ACoS) is at some point. It’s a great question that seems simple, but has a complicated answer. There’s much more to ACoS than meets the eye, but you can still have some general numbers to follow.
Read on to discover the average Amazon ACoS!
What is the Average Amazon ACoS?
Many experts estimate that the average ACoS on Amazon is around 30%.
Your average ACoS might be higher or lower, depending on a number of factors. This estimated average is by no means a benchmark for your brand at any given point. If you’re new to Amazon, it might be a helpful guide, but as you get more familiar with Amazon Advertising, you’ll figure out what your average Amazon ACoS should be.
What is a Good Average Amazon ACoS?
There is truly no one-size-fits-all “good” ACoS for brands overall. However, a good rule of thumb is to aim for around 15–30% when you’re getting started. As you optimize your advertising, that number will likely lower.
A “good” ACoS will be different for everyone. Depending on your brand’s profit margin, advertising budget, and keyword competition, your ACoS will vary. There are a number of factors that determine your ACoS:
- Sales goals
- Campaign type
- Keywords
- Seasonality (high-traffic/holiday seasons)
- Product newness
- Competition
- Product price
- Campaign strategy
Based on all of these factors, your ACoS might differ for the same product over time! When you’re launching a product, a good ACoS might be 50%, but as it gains relevancy your target ACoS might be only 10%. And, if competition later increases, a good ACoS might be 25%. As you can see, ACoS is not the end-all-be-all statistic to base your success on. More and more people are tracking TACoS instead, as it serves as a more holistic view of your Amazon account, not just advertising directly.
What Should My Amazon ACoS Be?
Again, it all depends on your business goals. As we’ve stated earlier, 15–30% is a good baseline goal to begin with, but that will likely change over time.
If you’re launching a new product, you might want your ACoS to be around 30%. But, if you’re promoting one of your best-sellers, you might want it to be around 10%.
How can I Lower My ACoS?
There are a number of tactics to lower your ACoS.
Search Term Isolation, our bidding philosophy here at Blue Wheel, will help you lower your overall ACoS over time. This technique puts money behind successful keywords, so you’re only bidding on keywords that are successful for you. For a more in-depth look at how to lower your ACoS, check out this blog post on how to optimize your account.
Ultimately, working with an Amazon Advertising agency will allow you to lower your ACoS — if you work with the right partner. Finding an agency that can help you meet your goals is always important, but it’s also important to manage expectations about your ACoS. Talk with your agency partner to reach a common goal together!
Interested in working with an Amazon Advertising agency? Blue Wheel is the best in the biz.
