It limits the amount of current the FET switch can pass since the power dissipation is I(squared) X RON. On resistance is the key money spec for switching FETs.
To minimize error in the signal transmission through the switch, the load resistance on the switch output should be much greater then the switch resistance. Otherwise the switch resistance in series with the load resistance will act as a voltage divider and reduce the signal voltage. Since the switch resistance typically varies some with the signal voltage it could also induce signal distortion.