In Traditional Chinese Medicine (TCM), Er Cha belongs to the 'Herbs for external application' category. Like the name indicates, this category of herbs is used mostly for external application in the form of powders, pastes or ointments. As such they are used to treat trauma, inflammation, swelling, bruises, bleeding, pain and so forth.
Furthermore Er Cha is Neutral in nature. This means that Er Cha typically doesn't affect the balance in your body. Balance between Yin and Yang is a key health concept in TCM. Eating too many "Hot" (Yang) ingredients can lead to an imbalance whereby one has a Yang Excess. The inverse is true as well: too many "Cold" (Yin) ingredients can lead to a Yin Excess. The Neutral nature of Er Cha means that you don't have to worry about that!
Er Cha also tastes Bitter and Pungent. The so-called 'Five Phases' theory in Chinese Medicine states that the taste of TCM ingredients is a key determinant of their action in the body. Bitter ingredients like Er Cha tends to have a cleansing action on the body by clearing Heat, drying Dampness and promoting elimination via urination or bowel movements. On the other hand Pungent ingredients tend to promote the circulations of Qi and Body Fluids. That's why for instance someone tends to sweat a lot when they eat spicy/pungent food.
The tastes of ingredients in TCM also determine what Organs and Meridians they target. As such Er Cha is thought to target the Heart and the Lung. In addition to regulating Blood flow, in TCM the Heart is believed to be the store of the 'Mind' which basically refers to someone's vitality. In addition to performing respiration, the Lungs are thought in TCM to be a key part of the production chain for Qi and the Body Fluids that nourish the body.