>That said, these algorithms are simple presumably because they work "well enough".

Agreed wholeheartedly, and this is an important point: advertisers don't really lose much by showing you ads you don't want, so it's unlikely the system would ever become ultra-precise.

I don't really see how you could solve this problem with a sufficiently complex algorithm. Which ads are shown still depends on how much the vendor is willing to spend on marketing. I may have zero interest in Ford cars, but if Ford is the one spending the big bucks in the "car" category I'll see a lot of Ford ads.

What people seem to be looking for is not targeted advertising but targeted recommendations - where vendor "spend" can't skew the results to show you crap you don't want. But that's a product the consumer and not the vendor would have to pay for, by definition. Unfortunately consumers don't have deep enough pockets to make this kind of thing lucrative over just selling ads.