A manual entry is created when you yourself insert all the information into appropriate fields and then save that information as a citation:
A manual entry should always be your last resort when importing a reference into your library. First see whether it is not possible to directly import a reference into your library.
If you cannot directly import - it is still possible to input the reference by creating a manual entry. This is also useful if you have PDFs stored on your computer that you want to upload into your library, but no reference accompanying them.