Etsy's targeted ad keywords simply don't work more often that they do. It really isn't reliable since, as soon as you try and formulate a strategy around it, the keyword stats will all disappear. To be honest, based on our testing, I don't believe the targeting has ever worked properly anyway. If you can be bothered to check whether switching certain keywords off actually results in adverts not being generated for those keywords (even after 48+ hours) you will, as we did, figure out that it rarely, if ever, works.
Its been reported countless times and seems to be yet another thing that Etsy simply can't (or won't) fix. Our experience suggests that Etsy like to keep certain elements of the financials as opaque as possible, so it's increasingly difficult to monitor, at a detailed level, exactly where your money is going on advertising.
In short, if you're going to use advertising, get used to the idea that you will be paying for clicks on lots of keywords that Etsy deems appropriate, but which really aren't and there isn't anything you can do about it other than control advertising in a binary way, i.e. switch it off or on.
