A drive that condenses a file. In simplest terms, like a can of condensed soup where you add water or milk. Everything is there, it is just condensed.
A zip drive condenses the file so it can be saved or transported where limited space is available. When you want to open the file, you have to "unzip" it.
If you had need to transport a very large file that would not fit on a floppy, you would zip it, take it to another PC, cut/paste, then unzip. If both PCs have USB ports, this would probably not be necessary, but many PCs still use the floppies.