RationalWiki.org defines woo as:

a term for pseudoscientific explanations that share certain common characteristics, often being too good to be true (aside from being unscientific). The term is common among skeptical writers. Woo is understood specifically as dressing itself in the trappings of science (but not the substance) while involving unscientific concepts, such as anecdotal evidence and sciencey-sounding words.

Woo is usually not the description of an effect but of the explanation as to why the effect occurs. For example: “Homeopathy is effective (even when no molecule of the active ingredient remains in the final product) because the solution retains a memory of the solute.”—the explanation for these results, e.g. water memory, is woo.

Woo is used to blind or distract an audience from a real explanation or to discourage people from delving deeper into the subject to find a more realistic explanation. You can’t make money if nobody buys your bullshit. (As such, “woo” that has zero paying customers is more like just ordinary batshit crazy.)
Despite the terrible name, it has become quite a popular term within the skeptical movement—probably because it’s fun to say.