mmap can be used for a few things. First, a file-backed mapping. Instead of allocating memory with malloc and reading the file, you map the whole file into memory without explicitly reading it. Now when you read from (or write to) that memory area, the operations act on the file, transparently. Why would you want to do this? It lets you easily process files that are larger than the available memory using the OS-provided paging mechanism. Even for smaller files, mmapping reduces the number of memory copies.
mmap can also be used for an anonymous mapping. This mapping is not backed by a file, and is basically a request for a chunk of memory. If that sounds similar to malloc, you are right. In fact, most implementations of malloc will internally use an anonymous mmap to provide a large memory area.
Another common use case is to have multiple processes map the same file as a shared mapping to obtain a shared memory region. The file doesn’t have to be actually written to disk. shm_open is a convenient way to make this happen.