It can. It's not as good a DR channel as paid search, simply because you're buying demographics and interests rather than intent.
However, for list building and 'softer' DR actions like a whitepaper download or a lead form fill, it can work very well.
There's also a lot of off-the-wall targeting things you can do, like advertising your blogger program to mommy bloggers, targeting reporters at techcrunch and mashable with your app launch, and other things that fall outside of the scope of traditional display advertising.
I used this trick when I launched http://anynewbooks.com. I used existing credits (if I remember correctly) I had on both LinkedIn and Facebook to target publishers, book bloggers, and journalists. It worked, to a certain extent.
However, for list building and 'softer' DR actions like a whitepaper download or a lead form fill, it can work very well.
There's also a lot of off-the-wall targeting things you can do, like advertising your blogger program to mommy bloggers, targeting reporters at techcrunch and mashable with your app launch, and other things that fall outside of the scope of traditional display advertising.