How many times have you heard someone complain, "I just bought a desk lamp, and now I'm getting loads of ads for desk lamps. Don't they know I don't want another desk lamp?" And surveys back it up -- people would largely rather the ads they see reflect the things they're interested in. Because a well-targeted ad is good for the viewer. Sometimes they want the thing, and they buy it, and their life is improved.
If I'm statistically more likely to buy a particular item because of some demographic I belong to, and you have my demographic information, by all means use it to decide which ads to show me.
Maybe you having that information is a breach of my privacy, but if you do have it you should at least use it for something that'll benefit me.