What is Target ACoS?

Target ACoS (Target Advertising Cost of Sale) not to be confused with TACoS (Total Advertising Cost of Sale) is the desired threshold that a seller sets for how much they’re willing to spend on advertising to generate a certain amount of sales. It’s expressed as a percentage.

In simpler terms:

Target ACoS = (Ad Spend ÷ Sales Revenue) x 100% (your goal)

It helps sellers balance profitability with growth. Setting a clear Target ACoS lets you know if your advertising campaigns are performing according to your business objectives.

Why is Target ACoS Important?

1. Guides Campaign Strategy
   • Helps determine which keywords, products, and ad types are worth scaling.
2. Protects Profit Margins
   • Prevents overspending on ads by setting a ceiling for acceptable ad spend.
3. Helps Automate Campaign Optimization
   • Tools like SellerApp use your Target ACoS to adjust bids and budgets dynamically.

For Example

If your product sells for $50, and your cost (including product, FBA fees, etc.) is $35, your profit before ads is $15.

To break even on ads:

Target ACoS = $15 profit / $50 sale price = 30%

If you want to keep a $5 profit after ads:

Target ACoS = $10 ad spend / $50 sale = 20%

So in this case, a Target ACoS of 20% ensures profitability.

How to Set Your Target ACoS

1. Calculate your product cost and profit margin.
2. Decide how much margin you’re willing to spend on ads.
3. Use that number as your Target ACoS to guide campaign decisions.

Related Tools in SellerApp

• PPC Analyzer – Compare actual ACoS to your Target ACoS.
• Bid Automation – Set campaigns to auto-adjust based on Target ACoS.
• Profit Dashboard – Measure true profitability, including ad spend.