For example, we meet someone, somewhere, that has a male Rattata in its team. And us we have a female Rattata in our team. The other player and we decided to let our Rattatas sniffing each other, see if they are compatible and want to fall in love... If yes, there's a message saying "Rattata has fallen in love!" and BANG they reproduce. Then after a specific amount of time, our female Rattata lay an egg and after some steps, a baby Rattata is born. Also, before letting these rats multiplying, we can attach items like the ones that we can buy at the Pokemon Daycare, to make a more strongest baby. The difference with the Pokemon Daycare is that our two Rattatas are not "deleted". Or maybe they have to be deleted, I don't know...