What Your E-commerce Agency Report Should Show: ACOS, TACoS and More
A good e-commerce agency should make it easy to see whether your money is working. A bad report buries you in screenshots and vanity numbers. Whether you already work with an agency or are choosing one, here are the numbers a monthly report should include, how they are calculated, and the questions to ask when something looks off.
Start with the official definitions
Amazon Ads defines its two core efficiency metrics clearly. According to its ACOS guide:
- ACOS (advertising cost of sales) = ad spend ÷ ad revenue × 100. Amazon's example: spend $50 and earn $100, and ACOS is 50%.
- ROAS (return on ad spend) = ad revenue ÷ ad spend. Amazon calls ROAS "the inverse of Amazon ACOS"; in the same example ROAS is 2.
Amazon's ROAS guide adds that the two "are measuring the same results," just in different formats. If your agency reports ROAS and your team thinks in ACOS, convert: ACOS = 1 ÷ ROAS.
The KPIs a monthly report should include
| KPI | How it's calculated | Why it matters |
|---|---|---|
| Total sales | All sales in the period, ads and organic | The number your business actually lives on |
| Ad spend | Total paid to the ad platform | Your direct marketing cost |
| Ad-attributed sales | Sales the ad platform credits to ads | Shows what ads are directly driving |
| ACOS | Ad spend ÷ ad sales × 100 (Amazon Ads) | Efficiency of ad spend |
| ROAS | Ad sales ÷ ad spend (Amazon Ads) | Same as ACOS, inverted |
| TACoS (industry term) | Ad spend ÷ total sales × 100 | Whether ads are growing the whole business or just buying sales |
| Organic share | (Total sales − ad sales) ÷ total sales | Healthy growth usually lifts this over time |
| Contribution margin | Sales − product cost − platform fees − ad spend − shipping | Whether growth is profitable |
| Inventory health | Days of cover, stockouts, aged stock | Ads can't sell what's out of stock |
Sources: ACOS and ROAS formulas from Amazon Ads; other rows are standard calculations. Your agency should state how each number is defined in its report.
A worked example
| Month | Ad spend | Ad sales | Total sales | ACOS | TACoS |
|---|---|---|---|---|---|
| Month 1 | $5,000 | $20,000 | $40,000 | 25% | 12.5% |
| Month 2 | $6,000 | $22,000 | $55,000 | 27.3% | 10.9% |
Calculation: illustrative numbers using the formulas above. ACOS got slightly worse in Month 2, but TACoS improved because total sales grew faster than ad spend. Judging only by ACOS would miss that the ads helped the whole business grow. Ask for both numbers every month, side by side.
Your break-even ACOS equals your profit margin before ad costs. If you make 30% before ads, an ACOS above 30% loses money on ad-attributed sales. Ask your agency to show ACOS against this line for each main product.
Questions to ask about any report
- Which attribution window and source? Ad platforms credit sales differently; numbers from different tools won't match exactly.
- Is ad spend net of credits or promotions? Make sure costs aren't understated.
- What changed and why? A good report explains the main actions taken and their results, not just the numbers.
- What's next month's plan? Budgets, tests, new products and expected outcomes.
- How do fees affect the picture? If your agency charges a share of sales, check how that sales figure is defined.
Red flags
- Only showing impressions, clicks or ROAS, never total sales or profit.
- Changing which metrics appear from month to month.
- No access to the raw data or the ad account itself. You should always own the accounts; see how to give an agency safe account access.
- Explaining every bad month with "the algorithm" and no specific actions.
- Reporting sales without returns or refunds when your fees or decisions depend on net revenue.
To improve the numbers themselves, see our guide on how to lower ACoS.
How Atronia Innovations reports
We work in your accounts through user invitations, so you always see the same data we do. Channel Takeover pricing includes 1% of ad-generated sales, so we show exactly how those sales are measured. See our pricing or talk to our team.
