What is TACoS?
Total Advertising Cost of Sale
Total Advertising Cost of Sale - ad spend as percentage of total revenue.
The Formula
TACoS = (Ad Spend ÷ Total Revenue) × 100
TACoS (Total Advertising Cost of Sale) measures your ad spend against your total revenue, including both organic and ad-attributed sales.
Why TACoS Matters More Than ACoS
While ACoS only looks at ad-attributed revenue, TACoS shows how advertising affects your entire business. As your organic sales grow (often driven by ad-boosted rankings), your TACoS should decrease even if ACoS stays constant.
The Formula
TACoS = (Ad Spend ÷ Total Revenue) × 100
Example
If you spend $1,000 on ads and your total revenue (organic + ads) is $10,000:
- TACoS = ($1,000 ÷ $10,000) × 100 = 10%
TACoS vs ACoS
| Metric | What It Measures |
|---|---|
| ACoS | Ad spend ÷ Ad revenue only |
| TACoS | Ad spend ÷ Total revenue |
Key Insight: Decreasing TACoS over time indicates that advertising is effectively building organic sales momentum.
What's a Good TACoS?
| TACoS | Meaning |
|---|---|
| Under 10% | Excellent - strong organic presence |
| 10-15% | Good - balanced growth |
| 15-20% | Average - room to build organic |
| Over 20% | High - very ad-dependent |
The TACoS Growth Pattern
For a healthy Amazon business, you should see:
- Launch phase: High TACoS (maybe 30%+) as you build visibility
- Growth phase: Decreasing TACoS as organic sales grow
- Mature phase: Stable low TACoS (5-10%) with strong organic base
Examples
- →$500 ad spend ÷ $5,000 total revenue = 10% TACoS
- →$2,000 ad spend ÷ $20,000 total revenue = 10% TACoS
Related Terms
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