Glossary

Amazon PPC glossary

Definitions, formulas and worked examples for the numbers behind your Amazon advertising decisions.

ACoS
Advertising cost of sales (ACoS) is ad spend divided by the sales attributed to those ads, expressed as a percentage.
Blended ACoS
Blended ACoS is total ad spend divided by total ad-attributed sales across the products or campaigns being combined.
Break-even ACoS
Break-even ACoS is the ad-spend percentage that uses up a product’s contribution before advertising under the costs you include.
Conversion rate
For the PPC calculations here, conversion rate is attributed orders divided by ad clicks, expressed as a percentage.
Dynamic bids
Dynamic bidding lets Amazon adjust Sponsored Products bids in real time based on its estimate of how likely an ad click is to convert.
Max CPC
Max CPC is the highest average click cost your product can support at a chosen ACoS target and an assumed conversion rate.
Negative keywords
Negative keywords prevent ads from appearing for matching shopping queries within the campaign or ad-group scope where they are applied.
Placement bid adjustments
Placement bid adjustments increase a Sponsored Products base bid by a chosen percentage when the ad is eligible for that placement.
ROAS
Return on ad spend (ROAS) is ad-attributed sales divided by ad spend, usually expressed as a multiplier.
Search-term harvesting
Search-term harvesting means using search-term results to select a query for a separate keyword target or a product for a product target.
TACoS
Total advertising cost of sales (TACoS) is ad spend divided by total retail sales for the same business scope and period.
Target ACoS
Target ACoS is the advertising-cost percentage you choose to aim for after allowing for the contribution you want to retain.