I'm mentioning this here because you might hear the term from other people. You have to be savvier than most people to pull this off.
Cloaking is a way to make someone see a version of your website while at the same time forcing another person to view something completely different. Usually this is done by some Black Hat experts to hide a real website from Google while letting everyone else see the true content.
That sounds a little obscure so let's see some examples. Let's say you wanted to hide your website from the other jewelry store in your zip code. You could use some internet investigative methods to discover the settings for their store's internet connection, and then redirect them to a totally different website.
You might be tempted to use this Cloaking technique on your competition if they are always taking your ideas, but don't.
Cloaking is Black Hat!
If you do it, you will eventually get caught, or your competitor will report you to Google. You will be kicked out of the search engines once Google find out.