Advertising Cost of Sales (ACoS)

Advertising Cost of Sales (ACoS) is a metric used to measure the efficiency and profitability of advertising campaigns. It is calculated by dividing the total advertising spend by the revenue generated from those ads, expressed as a percentage. For example, if you spend $10 on ads and earn $100 in sales from those ads, your ACoS is 10%. A lower ACoS indicates more cost-effective advertising, meaning you’re spending less to make each dollar of sales. Businesses use ACoS to evaluate whether their advertising efforts are sustainable and contributing positively to overall profits.