Remarketing allows advertisers to connect with visitors who have previously visited your site by creating audience lists and then automatically share those lists with AdWords to show ads across the Google Display Network.
An audience lists can be created based on different criteria and the Ads will fulfill the intended purposed. For example:
|Audience criteria||Ad type|
|Users who viewed product-detail pages, but didn’t add those items to their carts||Ads for the items they didn’t add to their carts|
|Users who added items to their carts, but didn’t complete their purchases||Ads with a discount code for the items in their carts|
|Users who purchased items X and Y||Ads for related item Z|
A visual explanation by Google: