It holds a pastry bag for easy filling and storage. I'd rather hold the bag myself while filling, and my hand is free (this costs twenty bucks).
If you use a pastry bag for glaze or watered-down royal icing, which is more runny than buttercream, this might be a good investment, but you could also simply put a rubber band around the open end of the bag.
To dry your pastry bags after washing, hang them from a hook using the hole or the tab (see photo) on the bag.
If you just like the way this looks, we have one at Mary's Cupboard for less than $10.