This tool creates clumps of curves, by bending hairs toward the center curves. The positions and shapes of clumps are controlled by a secondary set of curves called clump curves. By default, the tool creates these for you and their spacing is controlled by the Clump Size parameter. This can be overridden for more fine-grained control by connecting a custom set of curves to the Custom Clump Curve input (4th input).
Clicking Clump on the Guide Process tab will put down a Hair Clump SOP where you can control the look and shape of the clumps. For example, you can adjust things like the tightness of the clumps and the amount of stray hairs. For more information, see the Hair Clump SOP help page.