The “contact” relationship is usually reserved for members who are in a professional, rather than personal relationship with another member.
It might be someone you met on V-TIP or know in real life that you would like to communicate with regarding work related opportunities. If you are an actor, writer, musician or producer you may want to collaborate with other artists on the site regarding your new album, independent film or other creative endeavors.
Contacts can be members who you have upgraded from Fan and have friend potential.
Contacts are the second most restrictive relationship.