It's a way for them to get to whether or not you understand the culture. Also, it allows them to, depending on the connection, track down the people and ask them what they thought.
There are two tiers here.
1) Close friends - these are people you are connected to either through extended interaction or prior networking. For example, may a family friend of yours went there and you were always close or perhaps a colleague from work went and you had drinks every Friday. That's the preferred "know".
2) Acquaintances: Ok, not everyone will know someone in that particular school well and in that case you have to revert to those you met during visits or by reaching out to organizations. This is a sub tier to #1 but it's still a great tier and shows the adcom a variety of things. For one, you're interested in the program enough to learn about it. And, aside from that, you wanted the honest answer so you heard it from the horse's mouth.
The key here, either with #1 or #2, is a MEANINGFUL connection. Don't mention a name of a person you met passingly at an event. But if you and s/he spoke for 10 - 15 minutes and you really appreciated their insight, then yes, include their name.
Does that make sense? Let me know if you have any other questions!
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