It's one of 3 settings that help filter out people who are marked as "seeing" an experiment in your database, but they didn't actually see it. For example, if your experiment is in a popup modal, but you track people on page load.
• Segments limit to a specific set of user ids
• Activation Metric limits to people who perform a certain action (e.g. opening the popup modal)
• Custom SQL Filter is for everything else where you need complete control over who is included