Question: Which advertising metrics showcase the percentage of sales spent on advertising?
- Advertising cost of sales (ACOS)
- Return on ad spend (ROAS)
- Cost per click (CPC)
Explanation
Advertising cost of sales shows the percentage of attributed sales spent on advertising. It is calculated by dividing ad spend by attributed sales, then multiplying by 100. This metric helps evaluate how much advertising cost is required to generate sales. A lower ACOS generally indicates stronger cost efficiency when the campaign is focused on profitable sales.
Why the other options are incorrect
Return on ad spend measures revenue generated for each dollar spent, not the percentage of sales spent on advertising.
Cost per click measures the average amount paid for each click, not ad spend as a percentage of sales.
Source for verification
https://advertising.amazon.com/library/guides/amazon-advertising-cost-of-sales-acos
https://advertising.amazon.com/library/guides/measure-improve-campaigns
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