[Maybe Kazuma never explained the term to her before? She has to think for a second how to explain it so that it makes sense... even though it's kind of hard to make sense out of it.]

An Essence is... kinda like having a part of someone else inside you? In the Story Realm, everyone had their own Essence; they were all characters that you'd find in stories and fairy tales. And you'd gain some of their abilities or traits, and those would manifest as either magic, skills, or it could change your appearance. Even your personality.