You can add, edit group lists in this section by entering a list name and description of the list. Adding users to a group list is done by the main Members section. You can mass add users to a list.
The advantage of the group lists is that you can mass-export users to a CSV file, export the lists to 3rd party software or mass delete members from your database. You can also communicate with any given group that you've setup without having to communicate with your entire we portal membership.... in other words, you can for example send a newsletter to all the merchants in a given region only without sending the newsletter to your entire website membership.