Amazon ROAS and ACoS, Explained
Amazon Ads shows two numbers for the same thing. ROAS is ad sales ÷ ad spend, so ₹5,000 of sales from ₹1,000 of ads is a ROAS of 5. ACoS is the other way round, ad spend ÷ ad sales, here 20%. A high ROAS or a low ACoS looks good, but neither tells you if you made money.
That depends on your margin. If your profit before ads is 25% of the selling price, your break-even ACoS is 25% and your break-even ROAS is 4. Below that ACoS, or above that ROAS, the ads earn money; past it, every sale from ads loses money.
