How do you work out ACOS on Amazon? The formula is ACOS = (Total Ad Spend ÷ Total Ad Revenue) × 100. Amazon calculates this automatically in your campaign dashboard, but understanding the math helps you set better bids. See our complete ACOS guide for step-by-step calculations.
Before you can reduce ACOS, you need to understand where you stand. Log into Seller Central and review your campaign manager:
Without this baseline, you are optimizing blind. Export your search term report and rank keywords by spend. You will likely find that 80% of wasted spend comes from 20% of your keywords — the Pareto principle in action.
Not sure what your ACOS means? Read What Is ACOS on Amazon? for a complete breakdown of the metric.
This is the single fastest way to reduce ACOS. Every week, review your search term report and add non-converting search terms as negative keywords. If you sell "stainless steel water bottles" and see clicks on "plastic water bottles," add "plastic" as a negative.
Focus your budget on keywords that indicate purchase intent. "Buy wireless earbuds" converts far better than "best headphones 2026." Long-tail keywords (3-5 words) typically have lower ACOS because the intent is more specific.
For Sponsored Products campaigns, exclude ASINs that are not directly competitive or that offer lower-priced alternatives. This prevents your ad from appearing on pages where the shopper is price-sensitive and unlikely to convert at your price point.
Your ad gets the click. Your listing gets the sale. If your listing does not convert, your ACOS will be high regardless of how well you manage bids.
Key listing elements that affect ACOS:
Top of Search (first page) typically converts at 2-3x the rate of Product Pages. Bid higher on Top of Search and lower on Product Pages and Rest of Search. In Seller Central, under campaign settings, use the placement adjustment feature to increase Top of Search bids by 20-50% and decrease Product Page bids by 20-30%.
For cost control, set your bidding strategy to "Dynamic bids — down only." This prevents Amazon from increasing your bids during high-traffic periods and only reduces bids when conversion is unlikely.
Not all hours of the day convert equally. Analyze your sales by hour and reduce bids during low-conversion periods. You can use third-party tools like Helium 10 or manage this manually with scheduled bid adjustments.
| Match Type | Use Case | ACOS Impact |
|---|---|---|
| Exact Match | Proven high-converting keywords | Lowest ACOS — tightest control |
| Phrase Match | Keywords with a consistent word order | Moderate ACOS — good balance |
| Broad Match | Discovery of new keywords | Highest ACOS — use for research only |
The proven workflow: Run broad match to discover new keywords. Move high-performing terms to phrase match. Once they prove themselves at phrase match, move them to exact match with optimized bids. This migration strategy keeps your ACOS in check while still feeding your keyword pipeline.
This is one of the most effective and most overlooked ACOS reduction strategies. Listing pages with product video consistently see 15-25% higher conversion rates than those with images alone. Higher conversion rates mean more sales from the same ad spend, which directly lowers your ACOS.
Amazon's algorithm also favors listings with video, giving them a slight ranking boost in search results. This means your ads can perform better even before a shopper clicks — a higher click-through rate from a more prominent search position.
Traditionally, creating product video required hiring a videographer at $500-$5,000 per video. VEONIB changes this: paste any product URL, choose a video style (lifestyle, studio, luxury, UGC, brand, or minimal), and download a professional video in under 60 seconds.
Product video boosts conversion rates by 15-25%, directly reducing your ACOS. VEONIB generates professional, ready-to-use product videos from any URL in under 60 seconds. No editing, no learning curve.
Generate your product videoFor more context on ACOS benchmarks and targets, read Amazon Advertising Benchmarks: What is a Good ACOS, CTR, and CVR?
Start with negative keywords, improve your listing conversion rate, adjust bids by placement, switch proven keywords to exact match, and add product video. These five steps deliver the fastest ACOS reduction for most sellers.
ACOS = (Total Ad Spend ÷ Total Ad Revenue) × 100. Spend $50, earn $250 in attributed sales = 20% ACOS. Amazon calculates this automatically in campaign manager.
Anything below your profit margin. For most categories, 15-25% is the target. During product launches, 30-50% is acceptable. Established brands should aim for 20% or lower.
Review ACOS weekly for active campaigns. Pull the search term report every 7 days to add negatives. Monthly deep reviews will keep your ACOS trending downward over time.
Yes. Product video improves conversion rates by 15-25%, meaning the same ad spend generates more sales and a lower ACOS. VEONIB generates product videos from any URL in under 60 seconds.
Both, but in sequence. Use broad match for keyword discovery, migrate winners to phrase match, and finally to exact match. Exact match gives the tightest ACOS control but limits discovery.