The @jabber.org portion identifies you in the Jabber network. This information is also used to determine the server to connect to (see RFC3920 for the exact look up process.)
If your XMPP server is not available via service name lookup via DNS - e.g. if you're using Google Talk and your Google address doesn't end in @gmail.com - then you must additionally specify the XMPP server name in the Advanced section.
If you're re-using a user account or connecting to a server from multiple Jenkins instances then you should specify a resource like jenkins@of1.jabber.org/sustaining.