"The product always needs to be good. But targeted ads such as on Google allow entire categories of businesses to exist."
With regard to niches, my experience has been the opposite.
If your niche is small enough, you can't properly bid on adwords for rare keywords because they are flagged as "low quality" and you are forced to either abandon those keywords or pay 10x for them to show.
This, of course, defies the entire raison d'etre of adwords - the whole purpose of which is (presumably) to bid on a keyword that targets that one rare person that searched for that.
But it can't be done - if only 5 or 10 people search for a phrase or keyword every day, it cannot be bid on properly.
I don’t know about the 5 to 10 search a day volume level - I was quite a bit above this. But I agree that if they don’t serve that volume level well, it’s sad and aggravating. That should be something that can really help people who are out of other options. Might it be a privacy issue? If an ad can be targeted to that level it can be used to address a single individual.
Sure, but you don't need to worry about conversion cost there.
I was faced with keyword combinations that had "natural" costs that were very low (and appropriately so, since I was the only person "bidding" on them). But then a few days later, "low quality score" and they ratcheted up the price 10x.
If you get a job out of it, the penalty doesn't really matter ... I was trying to convert $5/mo IaaS customers.
With regard to niches, my experience has been the opposite.
If your niche is small enough, you can't properly bid on adwords for rare keywords because they are flagged as "low quality" and you are forced to either abandon those keywords or pay 10x for them to show.
This, of course, defies the entire raison d'etre of adwords - the whole purpose of which is (presumably) to bid on a keyword that targets that one rare person that searched for that.
But it can't be done - if only 5 or 10 people search for a phrase or keyword every day, it cannot be bid on properly.