Definition of big word noun from Cambridge Dictionary Online: Free English Dictionary and Thesaurus
Big words are not necessarily long words. They're words that are not common in everyday speech, such as professional jargon or academic verbiage.
The text says that these words are sometimes used by people just to sound smart and be pretentious even though there are perfectly good simpler words that can express the same idea.
But at the same time, big words, because they express more complex ideas, allow more compact and more easily understandable communication. Instead of saying 20 words to explain something, you can use just one.
For example: imbricate means ‘having the edges overlapping in a regular arrangement like tiles on a roof, scales on a fish, or sepals on a plant.’
So, instead of saying more than 20 words to express that idea, you can say just one big word -- imbricate. Imbricate is used as an example of a big word.
I hope this is clear.