You might choose to use preferred layouts for dynamic display ads if your client:
wants to choose the layouts but not the features
doesn’t care if AdWords chooses the layouts and features
wants to choose the layouts and features
wants to choose the features but not the layouts
AdWords automatically pick from your preferred layouts. This option may make your dynamic ads even more effective by predicting the layouts that are likely to perform best for the people, placements, and platforms where they’ll show.
With preferred layouts, you’ll choose the layouts and features that you want. AdWords will only use layouts from this pool of preferred layouts (not available for retails feeds). Features of layouts include multiple product carousels, cropping your images to fit the ads, star ratings, and more. AdWords can predict the layouts that are likely to perform best for the people, placements, and platforms where they’ll show, making your dynamic ads even more effective.
Read more here: https://support.google.com/adwords/answer/3265299?hl=en
This article only applies to the previous AdWords experience. Determine which AdWords experience you’re using.
Dynamic display ads show customers personalized content from a product feed you control and attach to your campaign. Your ads show the new products, services, or promotions from your feed. Google originally introduced standard, non-responsive templates which are covered here for your reference, however, we strongly encourage using responsive ads for your dynamic campaigns.
For the greatest reach, create responsive dynamic display ads. Responsive ads can fit in just about any ad space, and can be easily created and edited. Learn how to create a responsive ad.
If you have a specific need that is not included in a responsive ad, you can also create custom dynamic ads with Google Web Designer. Follow the instructions below.