Picture-in-picture mode allows you to do two things at once, and see two apps at the same time. Yes, multi window mode is nothing new for Samsung Galaxy owners, but now it's available to any and all Android devices.
This is especially helpful for watching videos on YouTube or Netflix. As you'll be able to minimize the video while it continues to play and do something else on your phone simultaneously. Previously this feature was limited to Android TV, and now it works on all Android devices running Oreo.
Expect more apps to add support for this in the near future.