The Amazon TACoS Sponsored PPC Ads Strategy
Introduction
If you’re new to Amazon advertising, your metrics can become a major headache if you have no idea what to do with them. While advertising on the most prominent online marketplace today can help bring in the bucks faster, there’s just no magic shortcut to success.
Amazon is where millions of different brands from all over the world virtually hustle and bustle day and night. To thrive in such a competitive eCommerce platform, sellers consistently need to be one step ahead of the competition.
Meanwhile, you’ve probably already heard of TACoS, as it has lately become quite the talk of the town (and for a good reason). This advertising metric can give you a quick overview of your ad campaign performance. As a key performance indicator (KPI), TACos measures how much you spend on paid advertising relative to how much revenue you earn.
In this article, we’ll delve into the importance of Amazon TACoS and how you can use this as your guiding KPI in Amazon ads and overall advertising strategy.
What is TACoS in Amazon Advertising?
While tacos sound tempting, especially on a Tuesday, Amazon TACoS is serious business. TACoS, or “total advertising cost of sale,” is a performance metric that measures advertising spending relative to the total revenue generated. Along with ‘Advertising Cost of Sales (ACoS), TACoS organizes how business owners should view ‘Key Performance Indicators (KPI) to build organic traffic.
Tracking for numbers can get tedious if you don’t know what you’re looking for and don’t understand how it works. That is why streamlining your ads using your TACoS metric allows you to redefine your goals in the long run by emphasizing your analytics and PPC strategies.
How do I measure profitability using TACoS?
TACoS is calculated by dividing your advertising
spend by your total sales, then multiplying by
100.
Amazon TACoS Trends
What they mean
So, why does this metric matter to me and in Amazon advertising?
TACoS can give a clear and direct view of business performances on how Amazon Pay-Per-Click (PPC) ads are performing. Therefore, if your current campaigns are not producing the expected revenue to cover the cost of sales, it’s because profit is being drained rather than generated.
With this in mind, TACoS allows advertisers to reshape business plans and reflect on needed measures to keep things going. Ideally, with the increase in organic sales and brand awareness, ad spending should decrease.
Moreover, Amazon KPIs are valuable for determining how well you are implementing strategies. Understanding TACoS opens the door to other facets of online commerce, such as:
- Sales Revenue
- Click-Through Rate (CTR)
- Return on Ad Spend
- Customer Performance
- Inventory
- Amazon Seller Fees
- Ratings and Reviews
Final Words
In conclusion, TACoS can help you to:
1. Understand your profitability across-the-board
2. Monitor your dependence on advertising relative to revenue
3. Analyze the influence of ad sales on organic sales
Additionally, TACoS highlights a comprehensive view of how business strategies pan out concerning advertising relative to revenue generated and how it can create healthy business mindsets and intelligent decisions. It puts significance on how you should evaluate your overall investments, how you would be able to identify business flaws, and how you can overturn obstacles into growth potential.
The big takeaway is that getting tunnel-visioned would get you nowhere, even with TACoS on hand. Remember, there’s no harm in delving into different metrics since Amazon analytic tools because they exist for a reason. If you’re new to Amazon advertising, there’s definitely a lot to learn from Amazon advertising experts who have been running the PPC game for years. While there’s no magic shortcut to making it big on Amazon, the TACOS Sponsored PPC Ads Strategy is a productive approach to maximizing your campaigns.
Ready to drive your brand on Amazon?
