Dynamic Remarketing is basically a step further in the automation process when it comes to selling products associated with a Google Merchant Center. The system utilises the product ID of whatever the potential customer is interested in at that particular time and then gets a product image, name and price to include within the ad. This ad will automatically (or Dynamiclly) change to suit the product in question meaning that there is a much higher chance of the customer clicking on it.
Standard Remarketing isn't as clever as this and requires more input from yourself but is still a great feature for when a Google Merchant Center isn't involved. The ads are set (they don't dynamically change) and you will need to take care with your targeting preferences to ensure you remarket your ads to the appropriate audience.
If you want any information expanding upon or have another question then feel free to ask
ScottyD, AdWords Top Contributor
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