Option C: no cameras or crude wifi tracing needed; they know who you talk to / associate with based on location data and the full profile of both sides, and can estimate things like 'will have mentioned X' -> can dispatch that via heuristic like 'show ads for X thing that was also mentioned by someone adjacent on that social graph'.

That is, BiL was marked as 'spreader for airport grade tar' based on recent activity, marked as having been in contact with spreadee, and then spreadee was marked as having received the spreading. P(conversion) high, so the ad is shown.

It's just contact tracing, it works well and is really easy even without literally watching what goes on in interactions.