ROAS is revenue divided by ad spend; ACOS is ad spend divided by revenue. They are reciprocals of each other, so a 25% ACOS is a 4x ROAS and a 50% ACOS is a 2x ROAS. Convert between them with ROAS = 1 ÷ ACOS. Neither is better — Amazon reports ACOS by default, most other advertising platforms report ROAS.
How do ACOS and ROAS convert to each other?
Because they are reciprocals (ROAS = 1 ÷ ACOS), a small ACOS improvement at the low end is a large ROAS movement, which is why ROAS can look more dramatic in reporting.
| ACOS | ROAS | Meaning |
|---|---|---|
| 10% | 10x | Every $1 of ad spend returns $10 of sales |
| 20% | 5x | Efficient — common target for established products |
| 25% | 4x | A frequently cited healthy target |
| 33% | 3x | Acceptable if margin is high enough |
| 50% | 2x | Break-even for a ~50% margin product |
| 100% | 1x | You spent exactly what you earned |
Which one should I manage against?
Use whichever your team reads without converting in their head. What matters is comparing it against your break-even, not which format you picked.
If you run advertising outside Amazon, standardising on ROAS makes cross-channel comparison easier.
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