Glossary
Operator definitions for the Amazon Ads and D2C terms I use across the rest of the site. Each entry has the formula, an example, and links to deeper essays.
TACoS - Total Advertising Cost of Sales
TACoS is total ad spend divided by total revenue, including organic. It is the only Amazon Ads metric that ties campaign spend to the P&L.
ACoS - Advertising Cost of Sales
ACoS is ad spend divided by ad-attributed revenue. Useful for campaign-level decisions; misleading as a business metric.
CM1 - Contribution Margin 1
CM1 is gross profit after COGS, fees and freight - before any ad spend. The starting point for max ad spend math.
CM2 - Contribution Margin 2
CM2 is the net contribution after ad spend. The number that flows to operating profit.
ROAS - Return on Ad Spend
ROAS is revenue divided by ad spend. The inverse of ACoS.
Sponsored Products - Amazon Sponsored Products
Keyword and product-targeted ads that appear in search results and on product detail pages. The workhorse ad type.
Sponsored Brands - Amazon Sponsored Brands
Banner-style ads that show your logo and multiple products at the top of search results. Brand discovery, not conversion.
Sponsored Display - Amazon Sponsored Display
Display ads that appear on Amazon product pages and across the web. Audience- and remarketing-focused.
DSP - Amazon Demand Side Platform
Programmatic ad-buying platform that places display, video and audio ads across Amazon properties and the open web.
FBA - Fulfillment by Amazon
Amazon stores, picks, packs, and ships your inventory. The fulfillment side of Amazon's seller economy.
ASIN - Amazon Standard Identification Number
Amazon's unique 10-character identifier for every product in the catalogue.
SKU - Stock Keeping Unit
Your internal product identifier. Maps to an ASIN on Amazon. Used for inventory tracking across systems.
Listing CRO - Listing Conversion Rate Optimisation
Systematic improvement of product detail page elements - images, title, bullets, A+ content - to lift conversion.
Subscribe and Save - Amazon Subscribe and Save
Amazon's auto-replenishment program. Customers subscribe to repeat orders and receive a discount; the seller gets recurring revenue and predictable LTV.
Marketplace Expansion - Multi-Marketplace Expansion
Going from one marketplace (e.g., Amazon US) to multiple (Amazon UK, UAE, Noon, eBay, Walmart). The next-stage growth move for a single-marketplace brand.