It lets you generate a standalone macOS application that is just a window hardcoded to a particular web page. This means it gets its own dock icon instead of just being one of your web browser's windows or tabs, but more importantly, it does not share cookie data with other browsers.
So, for example, I have a Fluid app that loads the Tweetdeck web site, and it stays logged in to Twitter, but my regular browser is logged out, avoiding all kinds of tracking fuckery.
I'm also using it for Mastodon, because all of the macOS Mastodon apps are way less usable than the web site, but now I have the web site behaving like an app, and handing off clicked links to the "real" browser.
But even more useful is that you can have multiple apps with different logins, so if you have more than one account on a site, you don't have to keep logging out and back in to context-switch. You just generate a different app for each of them.