This action can be used to change the Action Scope for all further actions to chained to this one. Like with an if action, if you drop further action to the right of the Apply to... action then it will be run from the scoped object or instance. The scope is chosen from the pop up menu shown when you click the small arrow at the top right of the action, and in this way you can tell a different set of objects, or even a single instance if you have the instance ID, to run multiple actions before continuing with the code of the current object.
Note that to add actions into the "Applies To" block, they should be dropped to the side of the action, as shown in the image below:
These actions will now be run from the object or instance that is being targeted by the "Applies To" block, while any actions dropped elsewhere will be performed after the "Applies To" block.
The above action block code checks a variable to see if it equals 100 and if it does it changes scope to the "obj_Player" instances and tells them to run the Set Sprite action (all instances of this object in the room will change sprite at this point), before continuing to add 1 onto the variable within the instance running the full code block.