For Amazon’s advertising issues, many sellers are most concerned about Acos. Because Acos largely reflects whether this advertising project is profitable or loss-making.
Many novice sellers may ask: What is Acos? This is the abbreviation of Amazon’s advertising sales expense ratio, which is a percentage of the seller’s advertising expenses to advertising sales.
For example, if a seller spends $10 on advertising and gets $100 in sales from the advertising, the Acos value is 10%. Now, in the fierce competition, the 10% Acos figure has become very difficult.
Many sellers may ask this question again: What is the ideal Acos?
Some sellers may blurt out: The ideal Acos is of course the lower the better. In fact, this is not the case. Sellers trade with Acos to achieve their own goals. In some cases, the lower the Acos, the better.
For example, if a seller posts an advertisement for a new product on the website, the new product will be quickly included in the Amazon search system and open a weighted account. At this time, if you blindly pursue a lower Acos value, be timid in advertising, and bid low, the Acos may not be high, but the exposure rate and click-through rate will also be low. This is very unfavorable for new products.
In fact, sometimes the Acos value can drop very quickly. As long as the bids for each keyword are adjusted very low, as long as one or two small points are missed, the Acos value will be very beautiful. But at this time, Acos is actually at the expense of exposure and click-through rate. This approach aimed at reducing costs is not cost-effective.
For Acos, the most comprehensive measure is that the seller has mastered the break-even point.
Assuming the profit margin is 20%, then in a certain advertising group, if the seller’s Acos value reaches 20%, the advertising campaign will be able to break even. Below 20%, this type of advertising campaign is profitable, otherwise it will lose money. The selling price should be combined with the stage and purpose of its own promotion to reasonably determine its own marketing goals.