Five essential metrics
01 · CTR
Click-Through Rate
Measures how attractive and relevant your ad is.
CTR = Clicks ÷ Impressions × 100%
10,000 impressions and 100 clicks:
100 ÷ 10,000 × 100% = 1% CTR
100 ÷ 10,000 × 100% = 1% CTR
02 · CPC
Cost Per Click
Shows the average amount paid for each click.
CPC = Ad Spend ÷ Clicks
$100 spend ÷ 100 clicks
= $1 CPC
= $1 CPC
03 · CVR
Conversion Rate
Measures how many advertising clicks become orders.
CVR = Orders ÷ Clicks × 100%
10 orders ÷ 100 clicks × 100%
= 10% CVR
= 10% CVR
04 · ACoS
Advertising Cost of Sales
A key Amazon advertising efficiency metric.
ACoS = Ad Spend ÷ Ad Sales × 100%
$100 advertising spend generates $500 advertising sales:
100 ÷ 500 × 100% = 20% ACoS
Lower ACoS generally means greater advertising efficiency, but the right target depends on product margin and business objective.
100 ÷ 500 × 100% = 20% ACoS
Lower ACoS generally means greater advertising efficiency, but the right target depends on product margin and business objective.
05 · ROAS
Return on Ad Spend
Shows how many dollars in attributed sales are generated for each advertising dollar spent.
ROAS = Ad Sales ÷ Ad Spend
$500 ÷ $100
= 5.0 ROAS
Every $1 of advertising spend generated $5 in attributed sales.
= 5.0 ROAS
Every $1 of advertising spend generated $5 in attributed sales.
Core Amazon Ads funnel
Impressions
→
Clicks
→
Orders
→
Sales
→
Profit
Key idea: Good Amazon advertising is not simply about getting more clicks. Sellers should optimize keywords, bids, product listings, conversion rates and profitability together.