There is also the question of who's willing to pay for ads, and for much are they willing to pay. They have to pick from what's available. I see a lot more ads about stuff that is costly and profitable, i.e. photography gear, car rental, insurance.
I think that ads tend to be about costly stuff (if that is true) because they have to discount their own low accuracy. You can make money by showing me ads for goods worth only a few dollars, if there are enough chances that I'll buy them.
Why would you expect them to be able to? Algorithms aren't mind readers. Just because a human could look at all those individual data points and reach that conclusion doesn't mean a computer could.
> Advertisers in turn pay Google because it makes them sell more.
> Taking the money of the advertisers and not boosting their sales doesn't pay on the long run.
Which is it, advertising on Google boosts sales or no?
No. Please try to understand what I wrote.