If you’re running Amazon Sponsored Ads, ACoS (Advertising Cost of Sales) is the one metric that can make or break your profitability. Everyone wants to lower ACoS-but do it wrong, and your sales drop. Do it right, and your margins grow while revenue keeps climbing.

This post breaks down how to reduce ACoS without sacrificing sales, visibility, or momentum.

 First, What Is a Good ACoS?

ACoS = (Ad Spend ÷ Ad Revenue) × 100
Lower ACoS means better efficiency.

• < 20%: Excellent (Highly profitable)

• 20-30%: Good (Sustainable growth)

• 30-40%: Okay (But may need tweaking)

• > 40%: Danger Zone (Fix it fast)

Break-Even ACoS = Your profit margin.
If your margin is 30%, any ACoS above that means you’re losing money.

 Why Lowering ACoS Can Backfire

Many sellers try to reduce ACoS by:

• Lowering bids too much

• Pausing broad campaigns

• Turning off top-of-funnel ads

This might reduce your ad spend, but it also cuts traffic-and kills your sales velocity, which is crucial for organic ranking.

Instead, aim for a balance: more efficient spend + sustained sales.

 7 Smart Ways to Lower ACoS Without Killing Sales

1.  Identify & Focus on High-Performing Keywords

Use your Search Term Report (from ad console or Amazon reports) to:

• Double down on keywords with high conversion rates

• Shift budget to exact match campaigns for better control

• Remove low-performing keywords or add them as negatives

Pro Tip: Look for keywords with ACoS < your profit margin + decent order volume.

2.  Cut Wasted Spend With Negative Keywords

Wasted clicks = high ACoS. Add negative keywords to avoid irrelevant traffic.

Example:

• Selling premium headphones? Negative keywords: “cheap,” “refurbished,” “replacement.”

Do this weekly, especially for broad/auto campaigns.

3.  Switch to a Tiered Campaign Strategy

Instead of one big campaign, split into 3 levels:

Focus most of your budget on Tier 1 once data starts flowing.

4.  Adjust Bids Smartly, Not Blindly

Don’t just slash bids. Instead:

• Lower bids gradually for poor keywords

• Increase bids slightly for profitable ones (to gain more volume)

• Use dynamic bidding (down only) to let Amazon help you cut waste

Test bid adjustments in small increments (₹0.50-₹1) every few days.

5.  Optimize Product Listings

ACoS is affected by your conversion rate. Improve these to convert more clicks into sales:

• Title: Clear and keyword-rich

• Images: High-quality + lifestyle images

• Bullet Points: Benefits-focused

• A+ Content: If available, use it!

💡 Better listings = higher CVR = lower ACoS.

6.  Increase Organic Sales to Support Ad Efficiency

Don’t rely solely on ads. Combine with:

• Influencer marketing

• SEO-optimized listings

• Promotions & coupons

The higher your organic-to-paid ratio, the better your long-term ACoS.

7.  Optimize Timing & Placement

Not all hours or placements convert the same.

• Use placement reports to analyze performance

• Reduce or exclude poor-performing placements (e.g., Product Pages vs Top of Search)

• Consider dayparting: run ads during high-conversion hours only

 Final Thoughts: ACoS Is a Balance, Not a Battle

If you reduce ACoS by killing your ad visibility, you also lose:

• Ranking power

• Sales momentum

• Long-term organic traffic

The key is data-driven optimization-cutting waste while fueling what works.

 TL;DR Checklist

• ✅ Double down on exact match winners

• ✅ Cut poor-performing keywords and add negatives

• ✅ Use tiered campaigns to segment traffic

• ✅ Improve your listings to convert more

• ✅ Monitor placement + time-of-day performance

📞 Want to Reduce ACoS and Scale Sales?

eCommercean.com specializes in Amazon ads that lower ACoS while increasing total sales. Whether you’re spending ₹5,000 or ₹5L per month, we build custom strategies that work.

 Book a free 30-minute audit today and start scaling profitably.