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But you could identify them as ads and understand their purpose.

That will soon likely no longer be the case.

I submit that most people haven't been able to do that for some time now. Advertising wouldn't be such big business if it didn't work on a macro scale.
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Nowadays with so much "viral hacking" and "guerilla marketing", you have to be mindful about all content you consume

Perhaps only half of "ads" are actually marked as such

So, it won't change that much from today, the difference won't be as big as the difference between 2000s ads and today

How would we know if we can't identify them and they don't tell us? The ads are among us...
This was already lost with product placements in movies/TV shows.
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I mean, sure, some advertisers might get more sophisticated. The garbagefest of internet advertising won't go anywhere, though. It'll still be as bleak and obnoxious as always, because someone will always accept a buck to let you barrage their visitors' eyes and ears.
“The ads will get so good you won’t realize they’re ads and you’ll end up buying all this stuff without awareness of why you’re doing it”

Do you actually think this is going to happen *to you* or are you just speculating about all the idiot dupes out there?