Introduction
One of the biggest challenges for Amazon sellers in India is managing a high ACoS (Advertising Cost of Sales). While ads help drive visibility and conversions, a bloated ACoS can quickly eat into your margins — especially in competitive categories like fashion, electronics, or personal care.
But here’s the good news: You can reduce your ACoS without sacrificing sales. In this guide, we’ll share practical and actionable tips tailored for Indian sellers to lower ad spend, improve efficiency, and still keep the sales coming.
🎯 What Is ACoS and Why It Matters?
ACoS = (Ad Spend / Attributed Sales) x 100
- ACoS of 20% = You spent ₹20 to generate ₹100 in sales
- Lower ACoS = Better ad profitability
Your target ACoS depends on your:
- Product margins
- Business goals (launch vs scale)
- Competition
For most sellers in India, a healthy ACoS is between 15%–30%.
✅ 1. Improve Your Product Listing Before Touching Ads
Your ad will get clicks — but if your listing doesn’t convert, you’ll burn money.
Optimize:
- Title – Keyword-rich, benefit-focused
- Images – High-resolution, lifestyle + product shots
- Bullet Points – USPs, objections, specifications
- A+ Content – Add visual storytelling (if brand registered)
📌 Better listings = Higher conversion rate = Lower ACoS
🔍 2. Use Exact Match Keywords for High-Converting Terms
Broad and phrase match types drive more traffic, but they often increase ACoS due to irrelevant clicks.
Strategy:
- Analyze Search Term Report
- Find keywords that have generated conversions
- Create a manual campaign with exact match only for those terms
🎯 This lets you control spend and focus on high-ROI keywords.
⛔ 3. Add Negative Keywords to Cut Wasted Spend
If your ads show for irrelevant searches, you’ll pay for useless clicks.
Examples:
- Selling “Kids Cotton Socks”? Negative out “wool socks”, “adult socks”
- Selling “Wireless Keyboard”? Negative out “Wired Keyboard”, “Keyboard Course”
How:
- Go to Campaign Manager → Select Campaign → Negative Keywords tab
- Or use bulk upload in flat file campaigns
💰 This alone can save 20–30% of your ad spend.
💡 4. Shift Budget From Auto to Manual Campaigns
Auto campaigns are great for keyword discovery, but they often spend on low-performing terms.
Do This:
- Let auto campaigns run for 7–10 days
- Extract converting terms from search term report
- Create a manual campaign with exact + phrase matches
- Reduce daily budget on auto or pause it
🚀 Manual = More control over targeting and bidding = Lower ACoS
📊 5. Optimize Bids Based on Performance
Don’t bid blindly. Bids should reflect keyword performance.
How:
- Increase bid on converting keywords with low ACoS
- Lower bid on keywords with high ACoS and no conversions
- Pause keywords with poor CTR + high CPC
⚙️ Use Amazon’s suggested bid range as a starting point
🧠 6. Group Similar Products Into One Campaign
Running one campaign per SKU leads to scattered data and inefficient bidding.
Instead:
- Group similar products (e.g., same category or price point)
- Use product targeting to cross-sell and upsell
📈 Better data = smarter optimization = lower ACoS
📦 7. Use Product Targeting (ASIN Targeting)
Target your competitor’s listings directly to steal sales.
How:
- Go to campaign → Ad Group → Product Targeting
- Add ASINs of competing products
Tip:
- Choose listings with lower ratings, higher price, or weaker images
🥇 You’ll get cheaper CPC and often better conversions
🔁 8. Run Brand Defense Campaigns
Your own brand name is a high-converting, low-ACoS keyword — but competitors may bid on it.
Run:
- A manual exact match campaign targeting your brand name and top SKUs
✅ Keeps your top spot and reduces customer leakage to competitors
🛑 9. Pause Campaigns That Drain Without Returns
Set a threshold: If a campaign runs for 2 weeks with zero conversions, pause or revise it.
Consider:
- Changing creative or listings
- Retesting with lower bids
- Adding tighter targeting
🧮 10. Know Your Breakeven ACoS
Your ACoS goal should depend on your product profit margin.
Formula:
Breakeven ACoS = Profit Margin x 100
If your profit margin is 35%, then any ACoS under 35% is profitable.
Final Thoughts
Reducing ACoS doesn’t mean killing your traffic. It means focusing on efficiency, data, and control. With the right strategy, you can:
- Spend less
- Earn more
- Scale profitably
Amazon Ads is not “set and forget.” It’s a weekly process of reviewing, refining, and reinvesting.
📢 Want a Pro-Level Amazon Ad Audit?
At bizconsulting.io, we help:
- Audit your existing campaigns
- Create a structured ad funnel
- Bring down ACoS while keeping sales strong
📧 Contact us today and let’s turn your ads into a profit engine.
