How are ROAS and ACoS different?
← Back to Amazon ROAS vs ACoS: Which Metric Should Your Dashboard Prioritize?
Quick answer
ROAS (Return on Ad Spend) and ACoS (Advertising Cost of Sales) are two primary metrics used to measure Amazon advertising efficiency. ROAS represents the amount of revenue earned for every dollar spent on ads, while ACoS calculates what percentage of sales are spent on advertising costs. These metrics provide distinct perspectives on campaign performance.
Both ROAS and ACoS have a place in Amazon advertising analysis, but their calculations and implications for your campaigns are quite different. Understanding how each one works helps you make more informed decisions about your ad spend.
What is ROAS?
ROAS, or Return on Ad Spend, shows how much revenue you generate for every dollar spent on your ads. It is calculated by dividing your total sales from ads by your total ad spend. Higher ROAS values indicate that your ads are delivering more revenue per dollar, which is generally desirable when aiming for profitable campaigns.
What is ACoS?
ACoS stands for Advertising Cost of Sales and represents the percentage of your sales revenue that goes toward advertising. You calculate ACoS by dividing your ad spend by ad-driven sales and multiplying by 100. Lower ACoS values typically mean your ads are more cost-effective, and you are spending less to earn each dollar in sales.
When comparison matters
Choosing whether to monitor ROAS or ACoS can depend on your business goals. For growth and high-margin campaigns, tracking ROAS is often more helpful. For tight budget control or low-margin products, ACoS can help you identify when ad costs are cutting too deeply into profits. Comprehensive dashboards, such as the Amazon Ads Dashboard by Todoza, can make comparing both metrics easy.
Related products
Related guides
By understanding the differences between ROAS and ACoS, Amazon sellers and agencies can better prioritize which metric supports their advertising strategy. For a deeper comparison and insights on which to use for your analytics, explore Amazon ROAS vs ACoS: Which Metric Should Your Dashboard Prioritize?