Glossary · MarketplacesTOFU
TACoS (Total Advertising Cost of Sale)
The short answer
TACoS (Total Advertising Cost of Sale) is your ad spend divided by your total sales — organic and paid combined. ₹25,000 of ad spend against ₹2.5 lakh in total sales is a 10% TACoS.
Where ACoS tells you how efficient your ads are, TACoS tells you how dependent your business is on them.
How to read TACoS trends
- Falling TACoS, rising total sales — ads are building organic rank; the ideal
- Stable TACoS, rising sales — growing proportionally with ad investment
- Rising TACoS, flat sales — you're renting sales you should be earning organically
- Falling TACoS, falling sales — you cut ads and lost visibility
Why it matters on marketplaces
On Amazon and Flipkart, ad-driven sales improve sales velocity, which improves organic rank. Good advertising should therefore make you less dependent on advertising over time. TACoS is how you check.
TACoS trend interpretation
| Trend | Likely meaning |
|---|---|
| Sales up, TACoS down | Ads building organic sales — healthy |
| Sales flat, TACoS up | Ads buying sales without organic growth |
| Sales up, TACoS up | Growth driven by heavier ad investment |
| Sales down, TACoS down | Under-investing or losing visibility |
See ACoS and Amazon Ads.
TACoS in practice
A product's ad spend is ₹50,000 on total sales of ₹5,00,000: TACoS is 10%. If TACoS falls while total sales grow, advertising is building organic momentum.
TACoS in India
On Amazon India and other marketplaces, TACoS helps sellers see whether advertising builds overall sales, including organic ranking gains.
Frequently asked questions
What's a healthy TACoS?
It depends on margin and growth stage. Many established brands aim for single digits to low teens; launches run higher.
Can TACoS be too low?
Yes — very low TACoS can mean you're under-investing and ceding visibility to competitors.
How is TACoS calculated?
Divide total ad spend by total sales (ad-attributed plus organic) for the same period. ₹50,000 of ads with ₹5,00,000 total sales gives a 10% TACoS.
Is TACoS better than ACoS?
It's a broader view — use both.
What's a good TACoS?
It depends on margin and growth stage; falling TACoS with rising sales is a good sign.
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