You will listen to an album, then another album, then another......
All your songs or songs in the selected playlist will be shuffled by album.
If you are a user of PlayingAlbums for macOS, you will share its settings for PlayingAlbums for iPhone. You may not want to listen to songs serially of an album with multiple discs. Disc 2 is sometimes completely different from disc 1.
Playlists shuffled by albums can be shared with your other devices via iCloud