Caching is a technique used to store data temporarily that does not change frequently so as to allow its retrieval without having to request from the original source.An example of a caching scenario is in the case of a web page. If that web page does not change often, caching it locally on your computer can save time while rendering it if you hit reload your browser. The local copy is rendered instead of hitting the server each time.
Caching is not specific to Websites and web-pages. There are different caches such as database cache, disk cache etc that speed up all kinds of events. Caching makes loading a page much faster than having a server generate it from scratch.
Why is caching important?
Per google your website load time is a crucial factor in determining your Search Engine ranking. Caching speeds up page load time. Visitors are more likely to abandon your website if it takes long time to load.
WordPress has a long list of plugins available that allows reusing of the data from previous requests, thus speeding up future requests. This minimizes the amount of data flowing between the database, web server and the browser resulting in faster loading times.
What is CDN?
A Content Delivery Network is a network of servers that delivers cached static content from websites to visitors based on the geographical location of the visitor. A CDN acts as a layer between the visitor and your website.
User’s proximity to your web server has an impact on load time. The CDN servers are spread across the globe and serves content to the geographically nearest visitor. This can make pages load faster for your visitors depending on how close these servers are to them. The closer the CDN to the user, the faster the content loads.