how would you explain nofollow link to a client?

I tell them it's a link with a note attached saying "we're not vouching for this". People can still click it and it can still send traffic, it just doesn't pass the same ranking credit a normal link does. Google treats nofollow as a hint now rather than a hard rule, so it isn't worthless - but if they're paying for links, the nofollow ones shouldn't be priced like editorial ones.