
How to successfully run a Facebook dynamic product ads retargeting campaign
Dynamic product ad retargeting is more efficient and effective than classic ‘static’ ads – so go ahead and give it a try!
We are all familiar with classic advertisement banners. They are a great way to promote your product or service and they can be very effective. They are also completely outdated and inefficient.
‘Why?’, you ask.
Put simply, classic banners take up precious digital real estate which can otherwise be leveraged to simultaneously target specific audience segments. In order to display banner ads which are uniquely relevant to any given viewer, instead of displaying one advertisement, a dynamic banner utilizes user information such as:
- location
- browsing history
- retail history
It is in this way that you can invest less resources in advertising yet see a higher Return on Investment (ROI) in the form of conversions, Click-Through Rates (CTRs) or impressions.

The benefits of dynamic product ads on Facebook
The advantages of using dynamic product ad retargeting on any platform are clear:
- Efficiency - Dynamic retargeted ads allow you to decrease the amount you invest in advertising while increasing your ROI by capturing more traffic with highly relevant and personalized content.
- Audience - Dynamic ads help you effectively communicate and connect with your audience in a way that is more ‘real’ to them. Not only will you be able to boost brand conversions, you will also be able to increase brand awareness and brand favorability which are crucial when trying to seize market share over the long-term.
- Relevancy - One cannot overstate the importance of creating relevant ads at scale. This is a major advantage - once you setup your campaign, the algorithm does all the heavy lifting by creating hundreds or even thousands of unique ads that are then targeted according to relevancy.
If we hone in specifically on Facebook there are a number of unique benefits to using dynamic product ad retargeting as part of your Facebook ad strategy:
- Automation - You can upload your product catalog and allow Facebook to automatically generate product-specific ads. Facebook will also perform optimizations and automatically change or modify poorly converting ads.
- Specificity - Facebook currently allows advertisers to be very specific in terms of their target audience for a specific ad. This means that you don’t need to only rely on Facebook’s auto generated ads but really focus your campaign on a certain segment when necessary. Through Ads Manager and Power Editor you can target ‘people visiting a specific web page and not others’, if you want to poach a direct competitor’s traffic, for example.
How to setup dynamic ads for products
If you’ve reached the conclusion that Facebook dynamic retargeted ads are for you then go ahead and set up your first ad using this step-by-step guide:
Step 1: Open a Facebook Business Manager account
Head on over to Facebook Business Manager and create a new account following the steps that Facebook will walk you through.

Step 2: Add your product catalog to Facebook
The next step is adding your product catalog to Facebook - I recommend you only add products you are thinking of running advertising campaigns with. Click on ‘product catalog’ and then ‘add new product catalog’.

Note: Facebook works closely with Shopify and WooCommerce. If you happen to have a store with one of these marketplaces then your catalog integration process will actually be simplified. Follow these links for further steps to take:
- Shopify sellers - download the Facebook product feed app
- WooCommerce sellers - use the WordPress product feed plugin
Step 3: Add Facebook pixel code to your website
In order for Facebook to really understand your audience and their preferences they need to be able to track their activity on your website. That is why Facebook allows you to generate a base code on their website which you then need to copy and paste in the header section of every page of your website. This sounds more complex than it actually is - don’t worry, my brain freezes when I hear the word ‘code’ as well.
Here is a very clear and simple tutorial to help you create and install the necessary Facebook Pixel code on your website:
Step 4: Setup an ad template
Once you have your catalog uploaded and your pixel code in place, you can now set up an ad template which will dictate the direction for future ads as well. Here are the next steps you need to take:
- First click ‘create’ in Ads Manager and then choose ‘catalogue sales’ as your marketing objective.
- Set up your budget, schedule, and audience (this is based on information derived from the pixel you installed in the previous step).
- Choose a display option: single or multi-product ads. Then decide on placement, that is, whether you prefer your ad to appear in a person’s news feed, or on the column on the right.

Final steps
Don’t give up just yet, you are almost there! Here are the final steps you need to take in order to get your ad up and running:
- Add well-written ad copy to the ‘text’ box.
- Change the headline and news feed link description (otherwise, Facebook will create these automatically).
- Optional - you can add a Call to Action (CTA) button to your ad.
- Optional - You can add a ‘deep link’ which allows you to have more control over where someone is taken after clicking on your product add.
- Confirm your changes and publish your first dynamic product ad!
Facebook Dynamic Ads Best Practices
A second before you take the plunge, I would like to give you some best practices when dabbling in dynamic retargeted ads on Facebook:
Catalog Management - A good habit to develop is checking your product catalog on a daily basis. Dynamic Product Ads are largely dependent on a solid product catalog and good pixel configuration. Ensure that all items are uploaded and represented correctly by their respective correlating pixels.
Customization - In terms of customization it is worth considering customizing your dynamic ads using ‘Creative Tools’ in Ad Manager. Use this option to increase conversions by highlighting special shipping or pricing details, for example ‘free overnight shipping’ or ‘10 % Christmas discount’.

Product sets - Product sets are groups of items from your catalog which you can and use with dynamic ads. In the Catalog Manager you can apply certain filters such as price or gender to specific product sets. You can then create dynamic product ads based on those product sets. Be sure that your product sets contain enough items - at least four distinct items, and not variations of the same item - otherwise it can severely harm your ads’ performance.
Audience selection & use case options - In terms of audiences, you should try to target customers who are as close to the bottom of the funnel as possible - for example, someone who added a product to their cart and then abandoned it. To categorize these customers, you can check out this useful table. If you are looking for ‘new’ audiences, then I recommend targeting ‘lookalikes’ who share similar characteristics to customized audiences you are already targeting.
Summing it up
Successfully running dynamic product ad retargeting campaigns on Facebook requires a fair amount of planning. Take your time and organize your product catalog, decide which items you want to promote and test out different custom audiences. Dynamic product ads may require some optimization and testing, but for the most part once you have everything set up through Facebook Ad Manager your campaigns will run on autopilot. Try setting up one campaign at a time and make decisions regarding your next steps based on concrete results. And come back soon to read more about specific dynamic-ads-based retargeting campaigns, for example for customers who expressed interest in your products yet did not complete their purchase. The most important takeaway is that dynamic product ad retargeting is more efficient and effective than classic ‘static’ ads - so go ahead and give it a try!
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