Optimizing ACOS for Amazon Advertising: Strategies for Effective Management

Understanding how to efficiently optimize ACOS (Advertising Cost of Sale) is crucial for effective advertising management on Amazon. ACOS is a direct indicator of advertising profitability—lower ACOS indicates lower advertising costs per sale, while higher ACOS indicates higher advertising costs per sale.

We have compiled the following insights to help you understand the direction for optimizing ACOS in different scenarios. Let's delve into it:

1.High ACOS + High Conversion Rate:

In this scenario, high ACOS may result from high advertising spending. Sellers are advised to gradually lower bids without compromising ad rankings.

2.High ACOS + Low Conversion Rate:

Addressing the issue of low conversion rates is paramount. To improve conversion rates, focus on targeting more precise keywords and optimizing match types.

3.Low ACOS + High Conversion Rate:

When encountering this situation, consider the following optimization strategies:

▪️If the ad ranks high, there's no need to adjust bids further.

▪️If the ad ranks lower, gradually increase bids to improve rankings and attract more traffic and conversions.

4.Low ACOS + Low Conversion Rate:

This scenario often occurs with products having high average order values. Priority should be given to improving conversion rates by optimizing factors influencing conversion rates.

Sellers can analyze and optimize strategies based on their specific situations using the aforementioned four classifications.