The Planet is the “person” or “natural personality”. The Sign is the “mood” that the person is in.
So for example, Mars in Cancer. Mars has a fiery personality naturally, but when in Cancer these effects will be dampened by Cancer’s watery energy.
So it would be like a naturally aggressive person suddenly adopts a nurturing caring passive attitude.
Another example would be Moon in Leo. The naturally subdued emotional and intuitive Moon suddenly finds itself in the mood of childlike play.
So essentially, the core “person” stays the same, but the personality changes and allows certain traits to express themselves more than others.