Check out the Google Dynamic Remarketing infographic from CPC Strategy below to get a better idea of how remarketing/retargeting works. Source: CPC Strategy Blog
How To Set Up Google Adwords Remarketing Campaigns
What is Remarketing/Retargeting? Retargeting works by tagging every visitor to your site and then displaying your ads to those customers on other sites in the Advertising network. These types of ads usually perform better than standard display ads. This is because the potential customer has already been to your site and will recognize your brand. […]