Sling Resource Merger is a Differencing Mechanism which only works for standard Granite implementation.
Let's say you would like to overlay a node from /libs and update some properties on it. Overlaying a node to /apps needs exact structure under /apps folder. Without Sling Resource Merger concept, you would have to create a 1:1 copy towards node from /libs to /apps. Now, with Sling Resource Merger, you just need to create empty structure towards the node and only add properties you wish to update. This mechanism will take care of combining the structure based on priority of nodes defined in Apache Sling Resource Resolver Factory configuration.
It benefits the overlay/override of resources and/or properties to be merged with the original resources/properties rather than potential duplication of nodes.
The purpose for using the Sling Resource Merger in AEM are to:
Ensure that customization changes are not made in /libs. This is because the content of /libs is overwritten the next time you upgrade your instance (and may well be overwritten when you apply either a hotfix or feature pack).
Reduce the structure that is replicated from /libs.
That's it for the day🤩. Feel free to ask queries in comment section below, or you can reach out to me via chat/contact page.