For non-machine learning folks, this algorithms helps in grouping relevant items together. As a practical, using this algorithm you can segment your customers based on their purchase history and interests.
The actual algorithm is very simple, imagine a lot of points on the 2D plane and each of them represent customers, whom you want to segment/cluster. Now, chose random cluster points and assign those customers to these points, by their distance. That is, whichever customer is near to a point, it belongs to that. At the end of iteration, you have lots of customers assigned to each cluster. Now, for each cluster, take the mean of those customers and the move the cluster to this mean value. Slowly, the cluster points move to the center with all the customers surrounded, belonging to that cluster.
read more - https://en.wikipedia.org/wiki/K-means_clustering