The internet should have made targeted marketing easier, because people would effectively target themselves by visiting sites devoted to topics and communities they care about, instead of everyone watching the same four TV channels. But Facebook wants to become the only "internet channel", monopolizing the ability to target and forcing you to go through them.
My impression from talking to people who run ads for a living is that FB's ML-driven targeting is just orders of magnitude more effective than traditional "put an ad in a relevant forum" kind of thing. I don't have personal insight into how true that is.
As an individual, I really don't like having monopolies in ads, especially ones that _also_ have monopolies on personal data (FB and Google know everyone I talk to, everywhere I go, etc - yikes). But as a business, I really like the idea of having one platform to buy ads that can put them everywhere, and do a good job deciding where to show them.
I don't know what the solution is but I don't think I've seen it proposed anywhere yet. It's hard.
The solution I'm suggesting is to either break up Facebook or legislate away their business model. I know that would make your life as a business owner more difficult, but wouldn't you also feel a little bit better knowing your business couldn't be wiped out by a broken algorithm disabling your ad account?
Yeah, I definitely agree with your main thrust that a different business model, probably spurred by legislation, is needed. I just don't know what that business model (or the legislation) should be exactly - and I think the obvious things will have bad unintended consequences.
As a consumer, I started doing ~all searches and browsing in Firefox with uBlock, and I never log in to FB on Firefox. The ads I've gotten have, indeed, become a lot less relevant. Honestly, it's not great! Lowest-common-denominator ads feel really gross.
As an entrepreneur selling a consumer product I created on Shopify, access to well-targeted ads would make a huge difference to my business. (I can't use FB to advertise since I sell a pandemic-related product, long story).
It's a niche product, so non-targeted ads like "local newspaper ads" would probably perform far too poorly to justify their expense.
People who buy my product tend to be very grateful for it, but not many know it exists! It's crazy how much your perspective on personalized ads change once you're on the other side – I really wish I could use them!