> better = more relevant to the things I might want.

In my mind advertising serves 3 roles:

1. informational - this product exists and costs X

2. branding - X is really good at design, Y cares about the environment

3. generate new market/demand - cigarettes are cool, diamonds are about love, you smell bad so you should use deodorant

Targeting is only really suited for #1. 2 & 3 are about social signaling and crafting a narrative about a product. For example, seeing an ad for the Economist would have stronger signaling ("this is for important people") if you saw it on your boss' screen - not your own. There's an article[1] that goes into much more detail about this idea - but in my mind non-targeted advertising would be valuable if it was about brand-association and location (as in traditional media).

Edit: as an interesting side-note, click through rates are utterly meaningless for #2 and possibly #3. What matters is what the audience thinks and feels about the ad and the product/brand, not whether they buy it on the spot. Here, intrusive advertising destroys value by associating a brand with a negative experience (popups, rollovers, etc.)

[1] http://zgp.org/targeted-advertising-considered-harmful/