The Amazon total advertising cost of sale (TACoS) can help you understand your business’s relationship with advertising. Sellers unfamiliar with the TACoS and how to interpret this important metric will benefit from learning how it can dramatically improve your advertising strategy.
In this article, we’re going to discuss how Amazon sellers can calculate their TACoS, what the TACoS reveals about your advertising strategy, and how you can make changes to your TACoS to improve both advertising sales and organic sales.
If you’re an Amazon seller, the TACoS will open up your advertising strategy to devote funds to where it matters. Continue reading to discover how the TACoS can improve your advertising spending and help you maximize your profits.
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What Is Amazon TACoS?
When you become an Amazon seller, you have to start implementing Amazon tools to ensure you maximize your profitability. Amazon TACoS is a ratio measuring your total ad spend versus your total sales and it can give you a good idea of how effective your advertising budget is.
The formula for calculating your TACoS is as follows:
Ad Spend Total Sales 100= TACoS
It is important to note that TACoS is completely different from Target ACoS.
What Is the Difference Between TACoS and ACoS?
ACoS stands for advertising cost of sale and you can calculate it by dividing your ad spend by your ad revenue, an effective tool for managing your advertising campaign.
TACoS accounts for your total revenue, not just your advertising revenue. Using TACoS can help you determine overall profitability, monitor your reliance on advertisi