Ah, but they are "building brand awareness" (or who knows, maybe even legitimately testing the waters to see if they want to expand to Canada).

Nobody from the US ever visits Canada? This is a good example of how the spotlight effect combines with confirmation bias to make advertising look awful. All algorithms like this are going to have false positive rates, if their most successful ads are the ones shown to Americans in Canada should they stop because sometimes Canadians see them and are annoyed by them?

It's doubtful that the most successful ads are ones specifically shown to Americans in Canada, and the number of Americans in Canada at any given time is probably very insignificant compared to the number of Canadians in Canada.

It really does seem like a boneheaded advertising strategy to market yourself to a consumer audience when the overwhelming majority of them can't pay for your products, and when it's presumably easy to screen that audience out by IP address.

Reverse IP lookup is far from perfect when it comes to location identification. Also if you've recently travelled to the US wouldn't be out of the question to have a cookie set with that location info.