Google is in general not selling stuff to people. It is selling ad space to companies. Targeted ads only provide advantage if these companies will pay more, or if companies will spend more of their advertising budget for targeted ads.

I would be astounded if revenue dropped at all if Google stopped providing targeted ads, at least in the short term, because there is no serious competition. Longer term it may well be an advantage as you think, but I don't think it is a sure thing. Unless targeting gets an awful lot smarter, I think companies may choose to spend their dollars on cheaper, dumber services that provide the same conversion rates. Especially if privacy concerns and law changes enable a lot more people to drop out of the targeting.