It can also correlate it with geolocation data. Google, for eg, sniffs all broadcasted SSIDs with their StreetView cars. If you can pick up on a SSID (or any of the MAC addresses of the other devices), you can buy the data set that includes it which further pinpoints demographics given the neighborhood AMI.
You can also build behavioral profiles patterns based on things like, for eg, if a baby monitor model is present or a robot vacuum, if certain devices only connect at certain times, etc.
I think the general rule for adtech is that profile guesstimates just need to be around 70%+ fidelity to determine if a sale can be made.
Lastly, you can also just sell the data on the gray market. The more datapoints, the higher the price. Most consumer product companies do that since we have little-to-no data privacy laws and the people who seem the most aware of it also are generally very apathetic and disinterested in advocating for them.
For example, your aged mother's phone will get pinged within X meters of an urgent-care facility, or she'll do some web-search about "hip pain", and then all the adult children start getting ads about elderly-parent-care.
Or perhaps the pervy-panopticon decides some phone-on-wifi events look like adultery, and both suppposed spouses start getting ads for divorce lawyers, private investigators, or track-covering products. (Bonus if certain specialized "adult" toys are detected on Wifi or Bluetooth...)
it's probably even more dystopian now with phone apps vacuuming up every last dreg.
Makes me think of DraftKings. You take your average 20 something sports fan - drinking beer, watching the game. And, on the other end of that smartphone display exist some of the most complex algorithms ever designed by teams of mathematics / statistics PhDs and it's deliberately built around targeting... this one guy from Florida who is pretty sure his team will be up by 7 at halftime.
Maybe it's more of a morbid joke, but it makes me laugh to think about.
It's an accurate explanation.
If you have even very crude data from somewhere else for the targeting, improvements in attribution tech are actually the more important factor. The adtech company mostly doesn't even care who you are, just whether the ad turned into a purchase or not, and that's where a lot of the invasive tracking comes from. They'd be perfectly happy with a quickly changing "identity" if they knew it was reliable and stable between ad and purchase.
I don't know if it has a microphone, to be clear. Just answering your question
so if you know that a user is having an affair, you might want to serve divorce lawyer ads (I'd imagine those are very expensive) or something.
this kind of data though is just like a cog in the machine, but it can e.g. give enough info to know how many people likely are in that household, and so on. useful when combined with other signals
Scale it up - make that millions of homes. Now there is godlike strategic value. Esp when "borrowed" by 3 letter agencies.