It's some kind of pheromone. Probably the same, or similar to what they use on Pee posts - which is a post you stick in the garden and it encourages them (especially the boys) to go in that particular spot. Dogs are big on the whole marking thing and they want to go where other dogs have been or where they've been before, which is why they work. It's why I don't use or see the point in puppy pads for puppies. Too confusing, since the last thing you want to do when toilet training them is encourage them to go indoors.
I have noooooooooo idea what affect it would have on cats though. The pheromone thingy would be specific to dogs. I would assume cats could smell it, but I don't know if it would mean anything to them.